International report card: Impact GST has had on global peers

With more than 160 countries having a Goods and Services Tax-like regime—tax rates ranging from 5 percent to 27 percent—the taxation scheme has become popular with governments across the globe because it reduces collection costs and eases complications involved in administering.

In its report analysing the costs and benefits of GST, Citi looks at the experiences other countries have had with the tax.Excerpts from the report:

Malaysia recently implemented a GST (from April 2015) and saw a sharpspurt in tax collections, but inflation rose and consumption growth wassignificantly impacted in the year after GST was implemented.

Other parts of the world where GST impact was studied include Australia (10 percent), Canada (5 percent) and New Zealand (15 percent). The countries, though, saw sharp rise in inflation post GST, the inflationary impact faded away after a year.Brazil:

Brazil has had a mixed experience from GST implementation owing tomultiple rates and weak tax administration/coordination at central and statelevels."