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Goods and Services Tax: Structural Reform

The Goods and Service Tax was introduced in 2017 with the objective of simplification of India’s taxation structure, increasing voluntary tax compliance and reducing tax evasion and corruption. Since then, several changes have been made to the GST structure by the GST Council, to resolve some of the challenges faced by the GST regime, but some have added to the general complexity of the new system. The paper identifies all areas of structural complexity and provides the first ever estimate of the progressivity of the GST. The paper proposes two options for simplifying the GST structure, and calculates their revenue implications.

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