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Nov 14, 2017 04:10 PM IST | Source: Moneycontrol.com

GST caused temporary slowdown, India poised to recover: Assocham

In its study, titled: “Ideate, Innovate, Implement: the apex industry body said: “While there has been a temporary slowdown after GST implementation (in July 2017), a consensus view is that India is poised for a sustainable growth in the near future.”

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Despite a temporary economic slowdown after the implementation of the Goods and Services Tax (GST) in July 2017, India is on the threshold of sustainable growth, industry chamber Assocham said in its latest report.

In its study, titled: “Ideate, Innovate, Implement:  the apex industry body said: “While there has been a temporary slowdown after GST implementation (in July 2017), a consensus view is that India is poised for a sustainable growth in the near future.”

It said that faster GST implementation, removal of check gates between states that have smoothened inter-state movements and central sales tax (CST) no longer being a cost will help improve the situation. The report maintained that GST will have a significant impact on all aspects of the businesses operating in the country including - supply chain, logistics, cash flows and transactions.

The study said that GST will have an impact on prices agreed for contracts entered under the pre-GST regime and proposed to be executed either partly or completely under the post-GST regime.

“Also, the introduction of GST should entail a reduction in overall process on account of reduced tax costs, the report said.

The Assocham-EY report also suggested central and state governments need to work in tandem by executing investor-friendly policies to further strengthen investment prospects.

“The government is continuously focusing on improving the business environment in the country, but there is still significant scope to attract further investments,” it added.

The study also suggested making the country more investor-friendly by introducing speedy judicial reforms to ward off investors’ worries, considering India’s legal framework.

While it welcomed the biggest changes in GST taxes, the apex industry body Assocham said that the decision of the GST council would lead to a pickup in consumer demand and significantly revive business sentiment.

Assocham General Secretary D S Rawat told The Times of India that “The increase in the composition scheme threshold would make life much easier for the small business entities. The impact of these changes would be positively felt in the next few months."

To read the full report, click here. 
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