India’s GST bill rollout: Structural benefits in the offing

Largest-ever indirect tax reform is expected to promote sustainable economic growth

On July 1, 2017, India ushered in its largest-ever indirect tax reform — the rollout of the Goods and Services Tax (GST) bill. The GST replaced 16 different types of state and federal taxes with one common tax system, comprising four major tax rates (5%, 12%, 18% and 28%) and a few other special categories for specified items. The bill is intended to simplify the taxation structure and be tax-neutral, by charging at the rates of the goods and services close to the existing rates.

Major tax categories


India’s economy: What does 2017 hold in store?

Driven by demonetization, India’s economic rejuvenation points toward a positive long-term outlook

Sambhshivan_Shekhar_sm_150dpi_RGBBy any measure, 2016 was a year of seismic economic change for India, particularly with the surprise “currency exchange program” in November, also referred to as demonetization. Three months after this unprecedented move, the overhang already seems to be behind us. Industrial production surged sharply by 5.6%, capital goods within manufacturing recorded 15% growth after several months of contraction, and electricity generation picked up to 8.9%.1 Overall car sales also reported an increase of 16% year-over-year.2 These positive macro points confirmed the view of the Equity Investment Team in Asia that the impact of demonetization would be transitory in nature.

Structural growth in India — especially domestic consumption — remains promising over the long term. Looking ahead, we expect