A Project Report On

PRE-GST AND POST GST A COMPARATIVE STUDY OF CONSUMER BEHAVIOUR.

SUBMITTED TO

UNIVERSITY OF MUMBAI FOR PARTIAL COMPLETION OF

THE DEGREE OF A & F (ACCOUNTING & FINANCE)
UNDER THE FACULTY OF COMMERCE

SEMESTER VI

SUBMITTED BY

PIYUSH HARISH PATIL

ROLL NO: - 241046

UNDER THE GUIDANCE OF

DR. SWAPNALI JANGLE.

MAHARSHI DAYANAND COLLAGE OF
ARTS, SCIENCE, COMMERCE AND HSVC
SHRI MANGALDAS VERMA CHOWK
25,Dr S.S RAO PAREL
MUMBAI-400012

ACADEMIC YEAR 2024-25

3
 MAHARSHI DAYANAND COLLEGE OF ART, SCIENCE & COMMERCE
NAAC ACCREDITED-A 2024-2025

This is certify that PIYUSH HARISH PATIL of A & F Semester VI (Academic Year 2024- 2025) has
successfully completed a research project on PRE-GST AND POST GST A COMPARATIVE STUDY
OF CONSUMER BEHAVIOUR. Under the Guidance of Dr SWAPNALI JANGLE.

_________________________ __________________________

DR. SWAPNALI JANGLE. DR. PORUNIMA RELKAR

(PROJECT GUIDE) (COURSE COORDINATOR)

_____________________
(EXTERAL EXAMINER)
_________________

DR H.O SHARMA
(PRINCIPAL)

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 DECLARATION

I, PIYUSH HARISH PATIL, Student of A & F (Accounting & Finance) Semester VI (Academic Year
2024-2025) hereby declare that I have completed the research project on-

“PRE-GST AND POST GST A COMPARATIVE STUDY OF CONSUMER BEHAVIOUR.”

The information presented in this project is true and original to the best of my knowledge. This project is
previously not submitted to any university for any Degree or Diploma Course of this or any other University.

________________________
PIYUSH HARISH PATIL

Roll No:- 241046

Place – Mumbai
Date

5
 ACKNOWLEDGEMENT

I would like to thank the University of Mumbai, for introducing A & F (Accounting & Finance) Semester V
course, thereby giving its student a platform to be abreast with changing. Business scenario, with the help of
theory as a base and Practical as a solution. I am indebted to our Principal Dr. H.O. SHARMA for roviding
necessary facilities required for completion of the project. I take this opportunity to thank our Coordinator
DR. POURNIMA RELEKAR for her support and guidance. I would sincerely like to thank her for all
efforts.

I would like to express my sincere gratitude towards my project Guide. DR.SWAPNALI JANGLE whose
guidance and care made the project successful.
I would like to thank my college library for having provided various references books and magazines related
to my project.
Last but not the least; I would like to thank my parents for giving me the best education and for their support
and contribution without which this project would not have been

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 INDEX

SR. PARTICULAR PAGE

NO NO
1 INTRODUCTION 1-29

2 RESEARCH METHODOLOGY 30
2.1 OBJECTIVE STUDY 31
2.2 SCOPE AND LIMITATIONS 32
2.3 REPORT ON DATA COLLECTION 33-35
3 LITERATURE REVEIW 36-41

4 DATA ANALYSIS,INTERPRETATION 42-57

AND PRESENTATION
5 CONCLUSION 58-65

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 CHAPTER 1
INTRODUCTION

Concept of Introduction of Tax:

The concept of the introduction of tax refers to the process by which a government imposes a financial charge
or levy on individuals, businesses, or goods and services within its jurisdiction. Taxes are essential for raising
public revenue to fund government expenditures, such as infrastructure, public services, and welfare programs.
When taxes are introduced, the government typically defines the type, rate, and scope of the tax, as well as
who is liable to pay it. The word comes from a Latin word ‘taxare’ or ‘Taxo’ which means to assess or to
estimate or to rate.

History of Tax:

The history of taxation dates back thousands of years, beginning with ancient civilizations like the Sumerians
and Egyptians, who taxed goods, labour, and land to fund public services and rulers' needs. In ancient Rome,
taxes were used to support the military and infrastructure, while the feudal system in the Middle Ages involved
taxes on land and produce, often collected by lords.

During the Renaissance, the concept of royal and church taxes expanded, and by the 18th century, income
taxes were introduced, with Britain implementing the first known income tax to fund wars. The French
Revolution highlighted the unfairness of taxes, leading to reforms.

The Industrial Revolution saw the growth of progressive taxation and the introduction of corporate taxes.
The 20th century brought widespread income taxes, especially in the U.S. after 1913, and taxes became
crucial for funding social welfare programs and global military efforts during the World Wars.

Today, taxes are a central part of funding government activities, with a mix of direct taxes (like income
taxes) and indirect taxes (like VAT). The digital economy poses new challenges for modern tax systems.

Taxation System:

Tax system is required to raise money to finance the government. Government then uses this taxation money
collected from its citizens to further provide them with only facilities , amenities and overall development
like infrastructure, health, education facilities, defence of the country, finance various projects and schemes,

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basic facilities for all etc .Taxes form almost 90% or more government revenue .This amount that gets
collected via taxes is kept in public treasury to meet the above expenditure of the government.

Essential characteristics of tax:

 It is enforced contribution and is personal obligation and it is levied by the government.

 It is proportionate in character, usually based on ability to pay.
 It is levied on person’s income and wealth like property etc with the jurisdiction of the state.
 It is levied for public purpose
 It is levied indirectly on goods and services which are consumed by end consumer.

Taxation in India:

In India this tax was introduced for the first time in 1860 by Sir James Wilson in order to meet losses
sustained by government on account of military mutiny of 1857 . In a new income tax was passed and again
it was replaced in 1922. This act remained in force upto the assessment year 1961-62 with numerous
amendments .In counsaltation with ministry in law finally the Income Tax Act was passed. This Income Tax
Act was brought in forced on 1st April 1962. It applies to the whole India

Indian tax system can be divided into two parts namely Direct Tax and Indirect Tax

Direct Tax

A direct tax is a type of tax that is levied directly on an individual or organization's income, wealth, or
property. The person or entity who is taxed is responsible for paying the tax directly to the government, and
they cannot pass the tax burden on to others.

Examples of direct taxes include:

 Income Tax: Tax paid on an individual's or corporation's income.

 Wealth Tax: Tax levied on an individual's net wealth or assets.
 Property Tax: Tax imposed on the value of real estate properties.
 Corporate Tax: Tax levied on the profits of companies or corporations.

The key feature of direct taxes is that they are paid by the taxpayer to the government and cannot be shifted
to someone else.

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Indirect tax

An indirect tax is a type of tax that is levied on goods and services rather than on income or wealth. Unlike
direct taxes, the burden of indirect taxes can be passed on from the person or business being taxed to the
final consumer. Essentially, businesses collect the tax from consumers when they sell goods or services and
then pay it to the government.

Examples of indirect taxes include:

1. Sales Tax: A tax added to the price of goods and services at the point of sale.
2. Value-Added Tax (VAT): A tax added to the value of goods and services at each stage of production or
distribution.
3. Excise Tax: A tax on specific goods like alcohol, tobacco, or fuel, often included in the price of the
product.
4. Customs Duty: A tax on imported goods.

In indirect taxes, the final consumer ultimately bears the cost, but businesses are the ones who are
responsible for collecting and remitting the tax to the government.

Advantages of GST:

a. Eliminates the cascading effect – GST is comprehensive in nature that is designed to eliminate
cascading effect. The cascading effect means the tax on a tax system that pre-existed where the tax
liability was passed at every stage of transaction. As a result the value price of the item increased.
GST removes this cascading effect and the tax directly lies on the cost of goods and services
b. Simplification of the Tax System: GST replaces multiple indirect taxes like sales tax, VAT, excise
duty, and others, bringing them under a single tax. This reduces complexity and creates a unified tax
structure.
c. Transparency: With a single tax system, there is greater clarity in the tax system. The process of tax
collection and payment becomes more transparent for both businesses and consumers.
d. Boost to Business Growth: By lowering the tax burden and simplifying the compliance process,
GST encourages entrepreneurship and promotes business growth. Small businesses also benefit from
simpler registration processes and reduced tax liabilities.

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 e. Reduction in Prices: The elimination of cascading taxes and the ease of doing business can lead to a
reduction in the overall cost of goods and services. The benefits of reduced tax burden may be passed
on to consumers in the form of lower prices.
f. Increased Compliance: GST has a robust electronic filing system, which makes tax payments and
filing of returns easier. This leads to greater compliance and fewer chances for tax evasion.
g. Promotes Export Competitiveness: GST provides a tax refund on export goods, making exports
cheaper. This makes domestic goods more competitive in international markets.
h. Improved Supply Chain Efficiency: GST allows for seamless movement of goods across state
borders, reducing transit times and costs. This enhances the efficiency of the supply chain and
logistics sector.
i. Revenue for Government: By broadening the tax base, GST helps the government collect more
revenue. The regular collection of taxes and the improvement in compliance contribute to stable and
predictable revenue generation.
j. Encouragement of Digital Payments: GST's reliance on digital platforms for tax filing, invoicing,
and reporting encourages the adoption of digital payments and e-commerce, driving further economic
modernization.

In summary, GST has been a transformative tax reform that brings many advantages in terms of simplicity,
efficiency, transparency, and economic growth

Disadvantages of GST:

a) Complexity in Filing Returns: Despite the intention to simplify the tax system, the process of
filing GST returns can be complex for many businesses, especially small ones. The different tax
slabs, forms, and frequent changes to regulations can be confusing and time-consuming.
b) Initial Implementation Challenges: The rollout of GST in many countries, including India,
faced significant challenges, such as lack of awareness, inadequate infrastructure, and technical
issues with the GST portal. These hurdles led to confusion and delays, especially for small and
medium-sized enterprises (SMEs).
c) Increase in Compliance Costs: While GST aims to streamline the tax system, it requires
businesses to maintain detailed records, issue GST-compliant invoices, and regularly file returns.
This increases the administrative burden and costs, particularly for small businesses that may
need to hire additional staff or invest in software.
d) Impact on Small Businesses: Although GST aims to benefit businesses in the long run, small
businesses often face difficulties in adapting to the new system. Some may struggle with the

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 compliance requirements or fail to meet the necessary thresholds, making it harder to stay
competitive.
e) Higher Costs for Certain Goods: Some products and services that were previously exempt from
taxes or taxed at lower rates may now be subject to higher GST rates. This can lead to increased
costs for consumers, particularly in sectors like real estate, healthcare, and education.
f) Frequent Changes in Tax Rates: GST tax rates have been revised several times since its
implementation, leading to confusion among businesses. The frequent changes can disrupt
business planning and financial forecasting, especially for industries with long production cycles.
g) Impact on the Informal Sector: GST primarily targets formal businesses, and small or informal
businesses may find it difficult to comply with the formal tax structure. This can lead to the
informal sector being left out or operating outside the formal economy, which reduces the
benefits of GST.
h) Problems with Technology: The reliance on technology for GST compliance, such as the online
portal for filing returns, can create challenges for businesses without proper access to the internet
or digital tools. Technical glitches and system errors can also delay or disrupt the filing process.
i) Burden on Consumers: While GST is designed to make the tax system more efficient, its impact
on consumer prices can vary. In some cases, consumers may face higher prices, particularly on
luxury goods or certain services, which could reduce their disposable income.
j) Increased Tax Burden for Certain Sectors: Some sectors that were previously subject to low
tax rates or exemptions may face a higher overall tax burden under GST. For example, certain
businesses in the hospitality, transport, and construction sectors may see an increase in their
effective tax rates.

In summary, while GST brings numerous benefits, it also poses challenges related to compliance,
increased costs, and impacts on certain sectors, especially in the early stages of its
implementation.

Features of GST:

The Goods and Services Tax (GST) has several key features that make it a comprehensive and unified
indirect tax system. Here are the primary features of GST:

1. Single Tax Structure:

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  GST consolidates multiple taxes, such as sales tax, VAT, excise duty, and service tax, into a single
tax structure. This eliminates the need for multiple taxes at different stages of production and
distribution.

2. Destination-Based Tax:

 GST is a destination-based tax, meaning it is collected at the point of consumption rather than the
point of origin. This ensures that the tax revenue goes to the state where the goods or services are
consumed.

3. Dual GST System:

 GST is a dual tax system in many countries (e.g., India), where both the central and state
governments levy the tax. There are:
o Central GST (CGST): Levied by the central government.
o State GST (SGST): Levied by state governments.
 Additionally, there is Integrated GST (IGST) for inter-state transactions, which is levied by the
central government but shared with the respective states.

4. Input Tax Credit (ITC):

 GST allows businesses to claim Input Tax Credit (ITC) on the taxes paid on their inputs (goods or
services). This reduces the cascading effect of taxes, as businesses can offset the tax they have
already paid against the tax payable on the final product.

5. Broad Tax Base:

 GST is designed to cover a wide range of goods and services, including both essential and luxury
items. However, essential goods and services may fall under lower tax slabs or exemptions.

6. Slabs Multiple Tax:

 In many countries (e.g., India), GST operates with multiple tax rates, usually categorized as:
o 0% (exemptions for essential goods/services),
o 5% (for basic goods/services),
o 12%, 18%, and 28% (for non-essential goods/services).
 Luxury items or specific services like entertainment may attract higher rates.
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7. Electronic Filing and Compliance:

 GST requires electronic filing of returns, payments, and other documentation. It relies heavily on a
digital platform for taxpayers to submit their data, making the process more streamlined and
efficient.
 GSTIN (GST Identification Number) is issued to businesses, and returns are filed periodically
(monthly, quarterly, or annually, depending on the business size).

8. Composition Scheme:

 GST offers a composition scheme for small businesses with turnover below a certain threshold,
allowing them to pay a fixed percentage of their turnover as tax, rather than the regular GST rates.
This simplifies tax compliance for smaller businesses.

9. Tax on Import:

 GST applies to imports as well. Imported goods and services are subject to Integrated GST (IGST),
which is collected by the central government, similar to the tax levied on domestic goods and
services.

10. Exemptions:

 Certain goods and services are exempted from GST or are subject to zero-rated tax, such as exports,
some basic food items, and services like healthcare and education.

11. Tax Authority and Administration:

 GST is administered by a centralized authority, such as the GST Council in countries like India,
which is composed of representatives from both the central and state governments.
 The tax is enforced by both central and state authorities through a uniform set of rules and
regulations.

12. No Dual Taxation:

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  GST eliminates the issue of dual taxation (taxing the same good/service multiple times) that existed
under the earlier indirect tax system. With a unified system, tax is only levied once at each stage,
reducing the burden on businesses and consumers.

13. Special Provisions for Certain States:

 GST has special provisions for certain states or union territories, including special economic zones
(SEZs) and some other specific rules for special regions like Jammu & Kashmir or Northeastern
states.

14. Anti-Profiteering Mechanism:

 GST includes provisions for an anti-profiteering mechanism to ensure that businesses pass on the
benefits of tax reductions or input tax credits to consumers in the form of lower prices.

15. Focus on Exports:

 GST is designed to make exports more competitive. Exports are zero-rated, meaning they are exempt
from GST, and businesses can claim refunds on the taxes paid on exported goods/services.

In summary, GST is a comprehensive tax system that simplifies indirect taxes by replacing a myriad of taxes
with a single, unified framework, promoting transparency, reducing the cascading effect, and encouraging a
more efficient tax structure.

Types of GST Levy:

GST (Goods and Services Tax) is levied in different ways depending on the nature of the transaction,
whether it involves the central government, state government, or both. The main types of GST levies
include:

1. Central GST (CGST)

 Levy: CGST is levied by the Central Government on the intra-state supply of goods and services.
 Applicability: It applies when the transaction happens within the same state or union territory.
 Example: If a business in Maharashtra sells goods to another business in Maharashtra, the CGST is
applicable on the sale.

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2. State GST (SGST)

 Levy: SGST is levied by the State Government on the intra-state supply of goods and services.
 Applicability: This applies when the transaction occurs within the same state, and the state is entitled
to collect the tax.
 Example: If a business in Maharashtra sells goods to another business in Maharashtra, the SGST is
applicable on the sale.

Note: In intra-state transactions, both CGST and SGST are charged simultaneously. The total tax rate is
divided between the central and state governments.

3. Integrated GST (IGST)

 Levy: IGST is levied by the Central Government on the inter-state supply of goods and services.
 Applicability: It applies when the transaction occurs between two different states or union territories.
 Example: If a business in Maharashtra sells goods to a business in Tamil Nadu, IGST is applicable
on the sale.
 Adjustment: IGST paid by the seller can be claimed as a credit against the CGST and SGST liability
in the destination state (Tamil Nadu in the example). This ensures the seamless flow of credit and
avoids cascading taxes.

4. Union Territory GST (UTGST)

 Levy: UTGST is similar to SGST but is applied in Union Territories (UTs) without a legislature (e.g.,
Andaman and Nicobar Islands, Lakshadweep).
 Applicability: This is applicable when the transaction takes place within a Union Territory.
 Example: If a business in Andaman and Nicobar Islands sells goods to another business within the
same territory, UTGST is applicable on the sale.

Note: When a transaction happens within a Union Territory, the total tax is divided between CGST and
UTGST (instead of CGST and SGST).

Summary of the Types of GST:

 CGST: Central Government’s share in intra-state transactions.

 SGST: State Government’s share in intra-state transactions.
 IGST: Central Government’s tax on inter-state transactions.
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  UTGST: Union Territory Government’s tax on intra-UT transactions.

These taxes ensure a seamless flow of goods and services across the country while allowing both the central
and state governments to share the revenue fairly.

Tax rate in India:

5% GST Rate

In India, the 5% GST tax rate is typically applied to essential goods and services. These are items that are
considered necessary for daily life and are meant to make basic products more affordable for consumers. The
5% rate is part of the GST tax slabs that categorize goods and services under different tax rates.

Examples of Goods and Services Subject to 5% GST Rate:

1. Food Items:
o Flour (Atta), Rice, Pulses (lentils), Vegetables, Fruits, and Unprocessed foods.
2. Healthcare and Medicines:
o Medicines, Medical equipment (for example, hospital bed, wheelchairs), and Health
supplements.
3. Common Household Items:
o Edible oils (except branded), Ghee, Butter, Cheese, Sugar, Tea, and Coffee.
4. Transport Services:
o Public transport services like buses, trains, and metro services (though some services may
have varying rates depending on the mode of transportation).
5. Footwear:
o Footwear with a retail price below ₹500 per pair.
6. Other Goods:
o Cement and bricks used for construction.
o Small appliances and kitchenware.

Key Notes:

 The 5% GST rate is generally intended to ensure that essential and commonly-used items remain
affordable to consumers, while still generating tax revenue for the government.
 Some items might fall under the 0% GST category (exempted), while more luxury or non-essential
items might be taxed at higher rates (e.g., 12%, 18%, or 28%).
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This tax rate reflects India's focus on making essential goods and services more accessible while maintaining
a broad tax base.

12% GST Rate

The 12% GST rate in India applies to a wide range of goods and services that are considered semi-luxuries
or goods and services that are not strictly essential but still part of the regular consumption. This rate is part
of the GST's progressive tax structure, where higher-value goods and services are taxed at higher rates.

Examples of Goods and Services Subject to 12% GST Rate:

1. Processed Foods:
o Processed fruits and vegetables (like fruit jams, pickles, juices).
o Canned or bottled foods (e.g., canned soups, ready-to-eat meals).
o Ice cream and other frozen desserts.
2. Household Goods:
o Toothpaste, Toothbrushes, Shaving cream.
o Kitchen appliances like blenders, mixers, and grinders.
o Furniture (except luxury or high-end furniture).
3. Clothing and Textiles:
o Clothing (fabric, ready-made garments, etc.) where the price is higher than the threshold for
the 5% category (for example, clothing above ₹1,000 may fall into this category).
4. Construction Materials:
o Plumbing materials (pipes, fittings, etc.), tiles, and paint.
5. Automobiles and Auto Parts:
o Small cars and motorcycles.
o Auto parts and accessories (except those for luxury cars, which are taxed at a higher rate).
6. Health & Beauty Products:
o Cosmetics like makeup, perfumes, and skin care products.
o Personal care items like shampoos, conditioners, and deodorants.
7. Travel and Tourism Services:
o Hotel accommodation with a room tariff between ₹1,000 and ₹7,500 per night.
o Tourist transport services (e.g., bus services for tourists).
8. Entertainment:
o Cinemas, multiplexes, and theater services (ticket prices for regular shows).

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 o Amusement parks and water parks.

Key Notes:

 The 12% GST rate applies to goods and services that are not essential but are still a part of regular
consumption, balancing affordability and tax revenue.
 Luxury items (like high-end cars, premium perfumes, etc.) are taxed at higher rates (18% or 28%
GST).

By imposing the 12% rate on these goods and services, the government ensures a tax burden on products that
are not basic necessities but still cater to a large section of the population. This rate helps broaden the tax
base without unduly burdening essential goods.

18% GST Rate

The 18% GST rate is one of the more commonly applied rates under the Goods and Services Tax (GST)
regime in India. It is typically applied to medium-range goods and services, which are neither basic
necessities nor luxury items but are essential for a broad section of consumers. This rate strikes a balance
between the 12% and 28% slabs.

Examples of Goods and Services Subject to 18% GST Rate

1. Consumer Goods

 Toilet cleaning products, detergents, and dishwashing liquids.

 Consumer electronics such as air conditioners, refrigerators, microwave ovens, washing machines, LED
lights, and other household appliances.
 Clothing and textiles (above certain price limits), including ready-made garments, shoes, and footwear.

2. Services

 Telecommunications services (such as mobile phone plans, internet services, and cable TV subscriptions).
 Restaurant services (except those with a lower tax rate or those providing specific exemptions like small
restaurants).
 Construction services (for residential properties under certain conditions).
 Professional services (like consulting, advertising, legal services, and architecture services).

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3. Health Care and Medical Products

 Medicines (non-essential or over-the-counter drugs, medical devices).

 Medical and health insurance premiums.
 Diagnostic services and hospital room charges for facilities not covered under exemptions.

4. Automobiles and Auto Parts:

 Mid-range cars and motorcycles (those priced above ₹10 lakh and not classified as luxury).
 Auto parts and components (such as engines, batteries, transmissions, and braking systems).

5. Food & Beverages:

 Packaged food products, snacks, soft drinks, and non-alcoholic beverages.

 Catered services (e.g., outside catering, weddings, etc.).

6. Other Goods:

 Furniture that is not considered luxury, such as office furniture and home furnishings.
 Footwear above ₹500 but below ₹1,000 per pair.

Key Notes:

 The 18% GST rate applies to semi-luxury and non-essential goods and services that are still
widely used by middle-class consumers.
 Professional and business services like marketing, advertising, and banking services are also
taxed under this rate.
 This rate is considered an "intermediate" rate between the lower rates (like 5% and 12%) and the
higher rates (like 28%) and covers a broad spectrum of products and services.

In summary, the 18% GST rate affects a large variety of goods and services, making it one of the most
significant tax rates in the Indian GST system. It applies to many commonly used products and services,
with the intention of striking a balance between affordability and tax revenue.

GST Structure in INDIA

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Source: Google images

Pre GST era in India:

Before the implementation of the Goods and Services Tax (GST) in India on July 1, 2017, the taxation
system in the country was complex and fragmented, with multiple indirect taxes levied by both the central
and state governments. These taxes created inefficiencies and led to higher compliance costs, which affected
businesses and consumers. Here’s an overview of the pre-GST tax system in India:

1. Central Taxes:

The central government levied the following indirect taxes:

 Central Excise Duty: Imposed on the manufacture of goods in India, especially for goods produced
in factories. It was one of the most significant sources of revenue for the central government.
 Service Tax: Imposed on the provision of services (except those specifically exempted), it applied to
a wide range of sectors like telecommunications, finance, entertainment, etc.
 Customs Duty: Imposed on imports and exports of goods, aimed at controlling the flow of goods
and protecting domestic industries.
 Central Sales Tax (CST): Applied to inter-state sales of goods. However, CST was a tax levied by
the central government but collected by the state government.

2. State Taxes:

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Each state in India had its own set of taxes on goods and services. Some of the prominent state taxes
included:

 Value Added Tax (VAT): The most common state-level tax applied on the sale of goods. VAT was
structured as a multi-stage tax that was levied at each stage of the production-distribution chain.
 Sales Tax: Before VAT, sales tax was the main tax imposed by states on the sale of goods. VAT
replaced many of these state-level sales taxes.
 State Excise Duty: Levied on specific goods such as alcoholic beverages, narcotics, and certain
products manufactured within the state.
 Stamp Duty: Levied on legal documents and transactions, such as property sales and agreements.
 Entry Tax: Levied on goods entering a particular state from other states, which was a way for states
to protect local industries.
 Luxury Tax: Imposed on luxury goods like high-end hotels, motor vehicles, and expensive
restaurants.
 Entertainment Tax: Applied to the sale of tickets for cinema halls, theaters, and other entertainment
events.

3. Taxation System Issues:

The tax system before GST had several shortcomings:

 Double Taxation: Businesses often had to pay multiple taxes on the same goods and services at
different stages of the production and sales chain, leading to cascading effects.
 Complex Compliance: With taxes imposed by both the central and state governments, businesses had
to deal with different tax authorities, filing returns, and adhering to different sets of rules.
 Lack of Uniformity: Different states had different VAT and sales tax rates, leading to inconsistencies
across the country. Businesses faced challenges when operating in multiple states.
 Tax Evasion and Leakage: The complexity and multiplicity of taxes led to significant opportunities
for tax evasion and leakage in the system.

4. The Need for GST:

The introduction of GST aimed to address these issues by creating a unified, transparent, and efficient tax
system. GST replaced the multiple indirect taxes with a single tax, covering both goods and services. It

15
introduced a system where taxes were levied at each stage of the supply chain with credit being allowed for
taxes paid on inputs. The pre-GST era in India was marked by a fragmented and complex tax system, with
multiple taxes imposed at the central and state levels. The implementation of GST was seen as a major step
towards streamlining India's tax system and enhancing ease of doing business in the country.

Post GST era in India:

The post-GST era in India, following the implementation of the Goods and Services Tax (GST) on July 1,
2017, marked a significant shift in the country's indirect taxation system. The GST replaced a complex,
multi-layered system of taxes with a unified, single tax structure that covers the entire country. This
transformation has had far-reaching effects on businesses, consumers, and the economy as a whole.

Key Features of the Post-GST Era in India:

1 One nation one tax

 GST replaced numerous indirect taxes (such as VAT, Service Tax, Central Excise, CST, etc.) and
consolidated them into a single tax applicable throughout India.
 This means businesses across the country no longer have to comply with multiple tax rates and
regulations from both state and central governments.

2. Dual GST structure

 GST is a dual tax system in India, which means that the tax is levied by both the Central Government and the
State Governments. There are three types of GST:
o CGST (Central GST): Tax levied by the central government on intra-state supplies.
o SGST (State GST): Tax levied by the state government on intra-state supplies.
o IGST (Integrated GST): Tax levied on inter-state supplies, which is collected by the central
government and then shared between the centre and the states.

3. Tax on Goods and Services

 GST applies to both goods and services, which were previously taxed separately by different
authorities (e.g., VAT on goods, Service Tax on services). This unified approach simplifies the tax
structure.

4. Input Tax Credit (ITC):

16
  GST allows businesses to claim Input Tax Credit (ITC) on the tax paid on inputs used to produce
goods or services. This credit is deducted from the tax liability on the final sale. The system of ITC
eliminates the cascading effect of taxes, which was one of the major drawbacks in the pre-GST
system.
 ITC improves cash flow and reduces the overall cost of production.

5. Uniform Tax Structure and Rates

 GST introduced a uniform tax structure across India. The tax rates are divided into four main tax
slabs:
o 5%: Applied on essential goods like food items, transportation, and other basic products.
o 12%: Applied on a range of goods and services like computers, processed food, etc.
o 18%: The standard rate for most goods and services.
o 28%: Applied on luxury items and sin goods such as cars, tobacco, and high-end products.
 Some goods and services are exempt from GST or taxed at a zero rate (like education, healthcare,
etc.).

Conclusion:

The post-GST era has fundamentally transformed India's tax landscape by simplifying tax compliance,
reducing tax evasion, and creating a unified market across the country. While there were initial challenges in
the implementation phase, the GST system has gradually become more refined and is expected to play a key
role in driving economic growth, promoting transparency, and fostering a business-friendly environment in
India.

17
Source: Google images

One nation One Tax: One Nation, One Tax" is a slogan that was central to the implementation of
Goods and Services Tax (GST) in India. The idea behind it was to create a single, unified tax system that
would apply uniformly across the entire country, thereby simplifying the taxation structure and promoting
ease of doing business.

Key Aspects of "One Nation, One Tax" under GST:

1. Uniform Tax Structure Across States

 Before GST, India had a complex indirect tax system where both Central Government and State
Governments imposed different taxes like VAT, Service Tax, Excise Duty, and CST. This led to a
fragmented system that created inefficiencies and compliance burdens.
 With GST, these multiple taxes were replaced by a single tax that is applicable across the country,
ensuring a uniform tax rate and structure, irrespective of the state in which the transaction occurs.

2. Unified Market

 GST aimed to eliminate the tax barriers between states. Prior to its implementation, there were
different tax structures in each state, leading to complications for businesses operating across
multiple states.
18
  GST allows goods and services to flow freely across the country without being subject to various
local taxes. This created a unified national market, which enhances economic integration and
promotes trade within India.

3. Single Indirect Tax on Goods and Services

 Under GST, both goods and services are taxed under a single system, making it easier for businesses
and consumers to understand and comply with the taxation rules.
 Previously, goods and services were taxed separately by different authorities (e.g., VAT on goods
and Service Tax on services). GST replaced these with a unified framework that covers both sectors.

4. Elimination of Cascading Effect

 Before GST, the cascading effect (tax on tax) was a major issue. Multiple taxes levied at various
stages of the production and distribution process led to businesses paying tax on the tax they had
already paid on inputs.
 With the Input Tax Credit (ITC) mechanism introduced under GST, businesses can offset the taxes
paid on inputs against the tax payable on outputs, thereby eliminating the cascading effect.

5. Dual GST System (Central and State Taxes Combined)

 GST is a dual tax system in India, meaning that both the Central Government and State Governments
levy taxes on the same transaction:
o CGST (Central GST): Collected by the central government for intra-state transactions.
o SGST (State GST): Collected by the state government for intra-state transactions.
o IGST (Integrated GST): Collected by the central government for inter-state transactions and
later shared with the states.
 This ensures both levels of government have a share in tax revenue, and it creates a seamless system
for businesses without different compliance requirements for each state.

Spending Patterns of Consumer Pre-GST:

Before the implementation of the Goods and Services Tax (GST) in India on July 1, 2017, consumer
spending patterns were influenced by the previous indirect tax system. The earlier system had a complex
structure with various taxes like VAT (Value Added Tax), excise duty, sales tax, and service tax, which were
19
applied at different stages of production and distribution. Here's an overview of how consumer spending
patterns were shaped pre-GST:

1. Higher Prices Due to Cascading Taxation

 Cascading Effect: Under the previous tax regime, consumers often paid tax on tax due to the
cascading effect. For instance, manufacturers paid excise duties, and then VAT or sales tax was
applied at the state level, leading to higher overall prices.
 Increased Prices on Goods and Services: This made products and services more expensive
compared to a potential unified tax structure like GST. Consumers were spending more on goods and
services because the taxes were embedded at different levels.

2. Impact on Consumption Patterns

 Price Sensitivity: Consumers were more price-sensitive due to the higher tax burden, especially for
non-essential goods. Many opted for lower-cost, lower-quality products or services.
 Luxury Goods: Luxury items and branded goods were particularly impacted by the higher tax rates,
and their consumption was more limited to higher-income groups.

3. Regional Variation

 State-Level Taxes: Before GST, each state had its own tax structure, meaning taxes on goods and
services could vary significantly from one state to another. This caused disparities in pricing across
regions.

 Cross-Border Purchases: Some consumers in states with higher taxes often purchased goods from
neighboring states with lower taxes, leading to some regional imbalances.

4. Increased Complexity in Taxation

 Confusion and Lack of Transparency: The complex tax structure led to confusion among
consumers about how much tax they were actually paying on goods and services.
 Less Clarity on Pricing: The multiple taxes hidden in prices made it difficult for consumers to
gauge the true cost of products and services.

5. Taxation on Services

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  Service Tax: There was a service tax applicable to many services like telecom, entertainment, and
professional services. However, the tax rates varied, and the scope of services under the tax net was
also limited, leading to inconsistent spending patterns.

6. Shift Towards Organized Retail

 Preference for Branded and Organized Retail: The complexity of the tax system encouraged a
shift towards organized retail outlets where consumers were more likely to pay a set price without the
confusion of fluctuating taxes. This trend particularly benefited larger retail chains and branded
stores over unorganized and local markets.

7. Impact on Savings and Investments

 Savings and Investment Behavior: Higher costs in goods and services could have an impact on
savings behavior, with consumers feeling the pressure of increased expenditure. As a result, there
was a tendency to spend more on immediate needs, potentially reducing the amount available for
savings and investments.

8. Seasonal and Regional Influences

 Festive and Seasonal Spending: Consumer spending patterns were highly influenced by regional
festivals and seasons. Goods and services would see increased demand during peak seasons, often
influenced by promotional campaigns, offering discounts to offset high tax costs.

9. Avoidance of Certain Taxes

 Black Market and Unaccounted Goods: Due to the complexity and high tax rates, there was often a
prevalence of the black market, where goods were sold without the tax being paid, particularly for
items like electronics and certain luxury goods.

Conclusion:

Pre-GST, consumer spending was shaped by a fragmented tax system that increased the complexity of
purchases and often led to higher prices. The shift to a single tax regime under GST was expected to
simplify and reduce the overall tax burden, leading to changes in consumer behavior. With GST, taxes are
now more transparent, and the cascading effect has been reduced, which has made a more consistent pricing
model across the country.
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Spending Patterns of Consumer Post-GST:

Post-GST (after the implementation of the Goods and Services Tax on July 1, 2017), consumer spending
patterns have undergone significant changes due to the simplification of the tax structure, reduction in tax
cascading, and overall alignment of tax rates across the country. Here's an analysis of how consumer
spending has evolved in India post-GST:

1. Lower Prices for Many Goods and Services

 Reduction in Tax Burden: One of the key impacts of GST was the reduction in the overall tax
burden on many goods and services. Pre-GST, multiple indirect taxes like VAT, excise duty, and
service tax were applied at different stages. With GST, many goods and services saw a reduction in
taxes, particularly in the case of products that were previously taxed at higher rates (e.g., food,
clothing, and household items).
 Impact on Essential Goods: Essential goods, such as food, medicines, and everyday household
products, became more affordable for consumers due to lower taxes or inclusion in the lower GST
slabs (0% to 5%).

2. Price Transparency

 Simplified Tax Structure: The transition to GST brought clarity and transparency to the pricing of
goods and services. Before GST, the complex tax system often made it difficult for consumers to
understand how much tax they were paying. Post-GST, consumers are more aware of the tax portion
of the prices due to the uniform tax rates and simpler invoices.
 More Organized Retail: As a result of simplified taxation, consumers have become more
accustomed to organized retail outlets, where pricing is clearer and tax-inclusive.

3. Increased Consumption of Goods and Services

 Boost in Demand: The reduction in prices for certain goods and services under the GST regime has
made them more affordable, leading to an increase in demand. For example, products like
electronics, apparel, and vehicles (which had higher pre-GST taxes) saw price reductions under the
new regime, boosting consumer purchases.
 Rising Demand for Non-Essential Goods: As prices of luxury and non-essential goods came down
due to a reduction in tax rates, spending on these items increased. The lower tax rates on certain

22
 luxury items under GST (such as premium cars, high-end electronics) contributed to increased
demand.

4. Shift in Consumption Patterns

 Widening Choices: Post-GST, consumers now have access to a wider variety of goods and services
due to the unification of the tax system. The increase in the number of products available at
competitive prices has expanded consumer choices.
 Change in Spending Priorities: While consumers still prioritize essential goods, the affordability of
discretionary and luxury items has led to an increased focus on lifestyle, experiences (such as travel,
entertainment, and dining), and personal consumption.

5. Regional Consistency in Pricing

 Removal of State Tax Barriers: Before GST, state-level tax disparities led to variations in pricing
for goods and services across regions. Post-GST, with a uniform tax system, there has been greater
price consistency across states, resulting in a more balanced consumption across the country. This
has allowed consumers to make purchases without worrying about variations in state taxes.
 Ease of Movement of Goods: Reduced transportation and logistical costs due to the elimination of
inter-state tax barriers have contributed to lower prices and better availability of goods.

6. Impact on the Service Sector

 Services Becoming More Affordable: Many services that were previously taxed under multiple
heads (e.g., service tax, VAT) have seen lower tax rates post-GST. For example, services like
telecom, insurance, and healthcare saw a reduction in taxes, making them more affordable for
consumers.
 Growth of New Service Offerings: The more streamlined tax structure has encouraged service
providers to expand their offerings, especially in sectors like e-commerce, entertainment, education,
and online services, leading to an increase in consumer spending in these areas.

7. Increase in Digital and Online Spending

 Online Shopping Boom: The unification of the tax system, coupled with the overall reduction in
GST rates for e-commerce businesses, has led to a rise in online shopping. Consumers have become

23
 more inclined to buy products online as they can now access transparent pricing and competitive
offers.
 E-commerce Accessibility: With GST helping regulate pricing structures, e-commerce platforms
have become more trustworthy, leading to increased consumer spending on digital platforms for both
goods and services.

8. Impact on Savings and Investments

 Increased Disposable Income: As many products and services became more affordable post-GST,
consumers experienced an increase in disposable income. This has allowed for increased spending on
discretionary items, while some have used the extra savings to invest in goods like real estate or
stock market options.
 Shift Toward Experience-Based Consumption: The availability of more affordable leisure and
entertainment options has led to a higher expenditure on experiences (e.g., travel, eating out, and
entertainment).

9. Introduction of Technology-Driven Transactions

 GST and Digital Payments: With GST requiring businesses to maintain accurate tax records and
file returns online, there has been a stronger push towards digital transactions, making it easier for
consumers to pay digitally. This has also encouraged greater transparency in consumer spending,
which indirectly influences their purchase decisions.

10. Consumer Behaviour in the Luxury Segment

 Luxury Goods: Post-GST, luxury items have become more accessible to some consumers, leading to
a boost in sales in sectors like high-end fashion, cars, and electronics. However, this segment still
remains primarily targeted at higher-income groups, and the consumption of such goods is more
sensitive to overall economic conditions.

Conclusion:

Post-GST, consumer spending patterns have evolved due to reduced prices, greater price transparency, and
more consistent pricing across the country. While spending on essentials and basic goods has increased due
to lower tax rates, there has also been a noticeable shift toward discretionary and luxury spending as more
consumers find these items more affordable. Additionally, the rise of digital shopping, improved service

24
affordability, and greater regional consistency in pricing are all shaping a more confident and dynamic
consumer market.

Difference between Previous Tax System and GST

The previous tax system in India and the Goods and Services Tax (GST) system differ significantly in
their structure, implementation, and impact on businesses and consumers. Here's a comparison between the
two:

1. Tax Structure and Type

 Previous Tax System:

o Under the earlier system, India had multiple indirect taxes levied at different stages of the
production and distribution process.
 Central Taxes: These included Excise Duty (on manufacturing) and Service Tax (on
services).
 State Taxes: These included Value Added Tax (VAT), Sales Tax, and Entry Tax (on
the movement of goods between states).
 Cascading Taxation: Taxes were levied at each stage of production and distribution,
leading to a cascading effect (tax on tax).
 GST System:
o GST is a single, unified tax system that replaced various central and state taxes.
 Dual GST Model: GST has two components:
 Central GST (CGST): Collected by the central government.
 State GST (SGST): Collected by the state government.
 Integrated GST (IGST): Levied on inter-state transactions, collected by the central
government and then passed to the destination state.
o It applies to both goods and services, ensuring one tax for one market.

2. Tax on Goods vs Services

 Previous Tax System:

o Goods and services were taxed differently.
 Goods: Goods were subject to VAT at the state level, which could vary across states.
 Services: Services were subject to Service Tax, which was central in nature and
applied to a specific set of services.
25
  Different Tax Rates: Different tax rates applied for goods and services, and some
items were exempt from certain taxes.
 GST System:
o Unified Tax: Both goods and services are taxed under the same system, and GST is
applicable to both. This unification makes the tax structure simpler.
o Common Tax Rates: Goods and services are classified into tax slabs (0%, 5%, 12%, 18%, and
28%), which apply uniformly across all states.

3. Cascading Effect vs Input Tax Credit (ITC)

 Previous Tax System:

o Cascading Taxation: Taxes were applied at each stage of the production and distribution
process, with no set-off mechanism. As a result, the tax burden increased as goods moved
from one stage to another, leading to a higher final price for consumers.
o No Input Tax Credit for Most Taxes: While VAT provided an input tax credit, businesses
were not able to claim credits for excise duty or service tax on many transactions.
 GST System:
o Input Tax Credit (ITC): GST allows businesses to claim an input tax credit for the tax paid on
inputs at each stage of production, thus avoiding the cascading effect. This mechanism helps
businesses reduce their tax burden and keep prices lower.
o Tax Credit Flow: Businesses can claim a credit for tax paid on purchases, which is offset
against the tax they collect from their sales.

4. Tax Jurisdiction

 Previous Tax System:

o Central and State Taxes: The tax jurisdiction was divided between the central and state
governments, with no clear uniformity across the country. Each state had its own VAT rates
and rules, which led to inconsistencies in taxation, especially when goods were sold across
state borders.
o Inter-State Transactions: For inter-state transactions, businesses had to deal with complex
state-specific entry taxes, resulting in increased compliance costs.

 GST System:

26
 o Unified National Tax: GST created a single, integrated tax structure that applies uniformly
across the country. It aims to create a common market with no barriers to the movement of
goods and services across states.
o Inter-State Transactions: Under GST, IGST is levied on inter-state transactions, which
reduces tax barriers and simplifies compliance for businesses dealing across state borders.

5. Compliance and Administration

 Previous Tax System:

o Multiple Returns: Businesses had to file multiple returns for different taxes (excise duty,
service tax, VAT, etc.) at the central and state levels.
o Complex Compliance: The requirement to comply with multiple laws and deal with multiple
tax authorities led to inefficiencies and higher compliance costs for businesses.
 GST System:
o Unified Return Filing: GST requires businesses to file a single, unified tax return (GSTR),
which reduces paperwork and simplifies the process.
o Simplified Compliance: The online platform (GSTN) enables businesses to file returns, pay
taxes, and track compliance easily, streamlining the tax administration process.

6. Impact on Business and Consumers

 Previous Tax System:

o Higher Costs for Businesses: Due to the cascading effect and the complexity of multiple
taxes, businesses faced higher operational costs. These costs were often passed on to
consumers in the form of higher prices.
o Inefficiency and Tax Evasion: The complexity of the previous system encouraged tax evasion
and the growth of the unorganized sector.
o Price Variations Across States: Consumers faced price variations depending on the state they
were in, as different states had different VAT rates.
 GST System:
o Lower Prices: With the reduction of cascading taxes and a more streamlined tax structure, the
GST system has led to lower prices for many goods and services, benefiting consumers.
o Boost to Formal Economy: GST has encouraged the formalization of businesses, leading to
better tax compliance and a reduction in the informal sector.

27
 o Uniform Pricing: The uniform tax structure has reduced regional price differences, allowing
consumers to enjoy consistent prices across states.

7. Exemptions and Tax Rates

 Previous Tax System:

o Multiple Exemptions: The earlier system had many exemptions and different tax rates across
states for various products and services, which added to the complexity.
o Tax on Specific Goods: Certain goods and services had different tax treatments, which often
led to confusion.
 GST System:
o Clear Tax Slabs: GST introduced clear tax slabs (0%, 5%, 12%, 18%, and 28%) and fewer
exemptions. Most goods and services are now taxed under one of these categories, with some
exemptions for essential goods (like food and medicines).
o Standardized Exemptions: Goods and services that are exempt or taxed at a lower rate are
now consistent across all states, leading to greater clarity for both businesses and consumers.

8. Impact on the Service Sector

 Previous Tax System:

o The service sector was subject to service tax, but only specific services were taxed, leading to
inconsistencies and difficulties in tax compliance for businesses offering multiple services.
 GST System:
o Uniform Taxation: Under GST, all services are taxed, and businesses can claim input tax
credit on services consumed in the course of their operations. This has made service sector
taxation more consistent and transparent.

28
 Aspect Previous Tax System GST System

Tax Structure Multiple taxes (Excise Duty, Single, unified tax structure
VAT, Service Tax) (CGST, SGST, IGST)
Tax Cascading Cascading effect (tax on tax) Input Tax Credit (ITC)
eliminates cascading taxes
Compliance Complex, multiple returns and Single return filing, simplified
authorities compliance
Tax Jurisdiction Divided between central and Unified tax applicable
state governments nationwide
Impact on Businesses Higher operational costs, Lower costs, better
inefficiencies compliance, more formalized
economy
Impact on Consumers Higher prices, confusion, Lower prices, clearer tax
regional price variations structure, consistent pricing

Price Transparency Inconsistent prices across Lower prices, clearer tax

regions structure, consistent pricing

In the above table there is summary mentioned about the previous tax system and current GST system

In conclusion, GST has greatly simplified the tax structure, reduced the cascading effect of taxes, and
provided a unified and transparent tax system, benefiting both businesses and consumers. The previous
system, with its complexity and fragmentation, created inefficiencies, tax evasion, and higher costs.

29
 CHAPTER 2

RESEARCH AND METHODOLOGY

Primary data collection:

In this project data have collected primary source with the help of structured questionnaire. Questionnaire was
sent to respondent in the form of Google Form and personally visited various individual. According to John
Best "Research is a systematic activity directed towards discovery and the development of an organised body
of knowledge." The systematic investigation of a problem with the intention of data collection, data analysis
and report writing characterize the essence of research.

This research study specifically examines the problems and challenges encountered by consumer in the
Mumbai city resident sector in Byculla Dist. Mumbai. It aims to raise awareness about government policies
related to this sector. The study is limited to the study area of Mumbai district providing a bird's-eye view of
the status and issues faced by consumer on GST.

Secondary Data:

In this project I’ve also collected data from secondary sources. This sources included

 Books
 News Paper
 ChatGpt
 Company’s website

Sample Design:

For this project I’ve used random sample method. In total of 50 sample chosen which are from my friend
circle, family, and locality. A combination of Snowball Sampling and Convenience Sampling methods was
employed to select a sample of 51 consumers from specific areas in Mumbai District. It is a non-probability
sampling techniques where each person who is named by someone, and asked to give name of other person
based on the willingness, availability and their readiness, the information was collected. The use of
convenience sampling aimed to minimize non-response errors

30
2.1 OBJECTIVE OF STUDY

 To study the GST structure in India and the behaviour of customer about PRE-GST era and POST-
GST era.
 To know the background of GST.
 To know the changes in the consumer, business, firm etc behaviour after the implementation of GST.
 To study the problem faced by individual towards the GST and changes is tax pattern.
 To know about changes in the structure of tax and GST.
 To understand how consumers adjusted their spending habits in response to different tax structures
(e.g., VAT, excise, and sales tax) across various states.
 To study how varying tax rates in different regions influenced consumer decisions regarding price
sensitivity.
 To study how varying tax rates in different regions influenced consumer decisions regarding price
sensitivity.
 To study how taxation on different goods and services (e.g., luxury vs. essential goods) influenced
consumption behavior.
 To explore how the lack of transparency in the previous tax system affected consumer psychology
and trust in businesses.
 To evaluate how different tax regimes impacted consumer confidence in the economy before the
GST rollout.
 To examine how price changes driven by state taxes and other indirect taxes influenced consumer
behavior.

31
 2.2 SCOPE AND LIMITATIONS

Scope:

This study is conducted to know the consumer perception towards GST and changes in tax system. It covers
the details information about consumer behaviour and their decision in buying the products. In this study we
can understand there are 4 types of GST like CGST, SGST, ITGS and UTGST. This also provides
information about tax slabs and different rates and whether this slabs or rates affects the consumer or not.

Limitations:

I. The study is individual consumer and their approach pre-GST and post-GST era in India
II. The study is based on minimum 50 respondent only.
III. There may be error as finding will be totally based on respondent responses.
IV. Rates of GST may change due to implementation of new tax rates
V. Various external factors such as inflation, interest rates, employment rates, and global economic
conditions could have influenced consumer behavior both before and after GST. These factors make it
harder to isolate the specific impact of GST on consumer behavior.
VI. Consumers had little need to understand the intricacies of the tax system, focusing more on the end
price and value.
VII. Taxation, being regionally controlled, had a more immediate effect on product pricing and thus
consumer spending. For example, luxury goods might have been taxed heavily in some states, reducing
demand, while other goods may have been comparatively cheaper.
VIII. Consumer behavior data before the implementation of GST might be scarce or inconsistent, especially
due to the absence of a unified tax structure. The variety of state-specific taxes (VAT, sales tax, excise
duties, etc.) meant that consumers in different states experienced different price levels. This makes
direct comparisons difficult

32
2.3 Report on data collection

Data collection is the process of gathering and measuring information on variables of interest, in an established
systematic manner that enables Researcher to answer stated research questions, test hypotheses, and evaluate
outcomes. The data collection component of research is common to all fields of study including physical and
social sciences, humanities, business, etc. While methods vary by discipline, the emphasis on ensuring accurate
and honest collection remains the same. The goal for all data collection is to capture quality evidence that then
translates to rich data analysis and allows the building of a convincing and credible answer to questions that
have been posed. Regardless of the field of study or preference for defining data quantitative, qualitative,
accurate data collection is essential to maintaining the integrity of research. Both the selection of appropriate
data collection instruments existing, modified, or newly developed and clearly delineated instructions for their
correct use reduce the likelihood of errors occurring. Data collection is one of the most important stages in
conducting a research. Researcher can have the best research design in the world but if researcher cannot
collect the required data, he/she will not be able to complete his/her project. Data collection is a very
demanding job which needs thorough planning, hard work, patience, perseverance and more to be able to
complete the task successfully. Data collection starts with determining what kind of data required followed by
the selection of a sample from a certain population. After that, you need to use a certain instrument to collect
the data from the selected sample.

Data are organized into two broad categories: qualitative and quantitative.
There are two types of Data Collection:
1) Secondary Data
2) Primary Data

➢ Secondary Data Collection:

Secondary data is the data that has already been collected through primary sources and made readily available
for researchers to use for their own research. It is a type of data that has already been collected in the past.
Sources of secondary data includes books, personal sources, journal, newspaper, website, government record
etc. Secondary data are known to be readily available compared to that of primary data. It requires very little
research and need for manpower to use these sources.

33
➢ Primary Data:
Data that has been collected from first-hand-experience is known as primary data. Primary data has not been
published yet and is more reliable, authentic and objective. Primary data has not been changed or altered by
human beings; therefore, its validity is greater than secondar data.

❖ Importance of Primary Data:

In statistical surveys it is necessary to get information from primary sources and work on primary data. For
example, the statistical records of female population in a country cannot be based on newspaper, magazine
and other printed sources. A research can be conducted without secondary data but a research
based on only secondary data is least reliable and may have biases because secondary data has already been
manipulated by human beings. One of such sources is old and secondly, they contain limited information as
well as they can be misleading and biased.

❖ Sources of Primary Data:

Sources for primary data are limited and at times it becomes difficult to obtain data from primary source
because of either scarcity of population or lack of cooperation. Following are some of the sources of primary
data. Experiments: Experiments require an artificial or natural setting in which to perform logical study to
collect data. Experiments are more suitable for medicine, psychological studies, nutrition and for other
scientific studies. In experiments the experimenter has to keep control over the influence of any extraneous
variable on the results.

❖ Methods of Primary Data Collection

1) Questionnaire: It is the most commonly used method in survey. Questionnaires are a list of questions
either open-ended or close-ended for which the respondents give answers. Questionnaire can be conducted
via telephone, mail, live in a public area, or in an institute, through electronic mail or through fax and other
methods.

2) Interview: Interview is a face-to-face conversation with the respondent. In interview the main problem
arises when the respondent deliberately hides information otherwise it is an in-depth source of information.
The interviewer can not only record the statements the interviewee speaks but he can observe the body
language, expressions and other reactions to the questions too. This enables the interviewer to draw
conclusions easily.

34
3) Observations: Observation can be done while letting the observing person know that s/he is being
observed or without letting him know. Observations can also be made in natural settings as well as in
artificially created environment
4) Survey: Survey is most commonly used method in social sciences, management, marketing and
psychology to some extent. Surveys can be conducted in different methods. In recent time Online Survey is
very famous tool which is used to collect primary data.

There are four main survey data collection methods – Telephonic Surveys, Face
to-face Paper Surveys, and Online Surveys.
a) Telephone Surveys:
Telephone surveys require much lesser investment than face-to-face surveys. Depending on the required
reach, telephone surveys cost as much or a little more than online surveys. Contacting respondents via the
telephonic medium requires less effort and manpower than the face-to-face survey medium. Respondents are
also highly likely to choose to remain anonymous in their feedback over the phone as the reliability
associated with the researcher can be questioned.

b) Personal Interview or Face-to-face Surveys:

Gaining information from respondents via face-to-face mediums is much more effective than the other
mediums because respondents usually tend to trust the surveyors and provide honest and clear feedback.
Researchers can easily identify whether their respondents are uncomfortable with the asked questions and
can be extremely productive in case there are sensitive topics involved in the discussion. This method works
best face-to-face as the data collection can collect as accurate information as possible.

c) Paper Surveys:
The other commonly used survey method is paper surveys. These surveys can be used where laptops,
computers, and tablets cannot go, and hence they use the age-old method of data collection; pen and paper.
This method helps collect survey data in field research and helps strengthen the number
of responses collected and the validity of these responses.

d) Online Surveys: Online surveys or web surveys are popular data collection tools that help organizations
collect inputs. Online Surveys are structured questionnaires used to collect data from a target audience for a
specific purpose. Creating online surveys is quite simple. Online Surveys come with an array advantages,
themost impressive being their ease of use. Not only are online easy to create but are simple to distribute and
collect feedback as well.

35
 CHAPTER 3

REVEIW OF LITERATURE

GST was first introduced by France in 1954 and now it is followed by 160 countries across the globe and
India is one of them. GST is one of the biggest tax reforms since 1947 for India, and, like an umbrella it has
subsumed majority of the indirect taxes and unified them into “ONE TAX”. Hence “ONE NATION ONE
TAX” as said by the ruling NDA government. The following is the literature review by various researchers
in their published research papers and/or articles who state the positive and/or the negative side of GST. This
literature review has reviews right from when GST was proposed to post GST introduction. These reviews
and opinions are subjective.

Abdul Hasan Khan, Associate Professor, Monad University, Uttar Pradesh, India
Says in his research paper that. “GST is biggest reform no doubt about it but my study shows that people are
not ready for this radical change and a lot of confusion is built in the mind and heart of common people.
Despite being noble intention and greater importance given by world bodies things cannot turn better on the
ground. And continuous meetings of GST council and in every meeting the results are less or more as per
expectations if there is any election period is near so council reacts differently than routine one. GST is more
than just a tax change. It is also a ‘behaviour change’ and its successful implementation will depend on how
well we as a nation adapt to the new requirements of doing business. Post the initial teething troubles, it is
expected that GST will bring in much good for all sectors and all sections of society.”

Agro Mali (May 2014)

Studied “Goods and Services Tax- An Appraisal” and found that GST is not good for low- income countries
and does not provide broad based growth to poor countries. If still these countries want to implement GST
then the rate of GST should be less than 10% for growth

Ahmad et al (2016)
Found that the level of awareness of GST is still not reached a satisfactory level. This is because the study
involved only general questions that should be known by the respondents as end users. This caused the
respondents to give a high negative perception on the implementation of GST. The respondents had received
less information and promotion from the authorities hence the negative response. Therefore, the government
must convince that GST will not have a lasting impact on the public as particularly convincing end users that
no increase will be on prices of goods and services.

36
Ahmad (2009):
The authors in the paper have discussed the proposed GST to be introduced in India, specifically in relation
to the place of supply rules for services to be adopted, the method to apply dual GST. The authors have
discussed the options to introduce the dual GST in India which could be Concurrent Dual GST, National
GST or State GST. Under the concurrent dual GST the better option was the one where GST is applied on
both goods and services. The other option explored was whether the Central GST would be on goods and
services but state GST would be only on goods. This option also recommended one single return with both
CGST and SGST details and PAN based registration. Given the difficulties in identifying the state where
SGST on services is payable, one more variant of dual GST was where the centre collects SGST on behalf of
states and then apportioning it on some scientific basis. The national GST is combining state and centre
taxes with any one body collecting taxes and then distributing depending on some agreed basis. The third
model where the CGST and SGST would coexist that mainly requires a constitutional amendment so that
states can tax services and centre can tax goods. Further the place of supply of services needs to be robust to
allow decision on which state would collect the SGST especially in case of intangible services. The authors
then discuss the various rates available to tax, the slab structures, exemptions, etc. The paper concludes that
whilst GST is much awaited all these issues need to be addressed for it to be effective.

Amit Ilager, Department of Political Science, C. M. Managuli Arts, Science and

Commerce College, Sindagi, Karnataka, India
Says in his research that, “The GST System is basically structured to simplify current Indirect Tax system in
India. A well designed GST is an attractive method to get rid of deformation of the existing process of
multiple taxation also government has promised that GST will reduce the compliance burden at present there
will be no distinction between imported and Indian goods & they would be taxed at the same rate. Many
Indirect Taxes like Sales Tax, VAT etc., will be finished because there will be one tax system i.e. GST, that
will reduce compliance present burden. GST will face many challenges after its implementation and will
result to give many benefits. In overall through this study we conclude that GST plays a dynamic role in the
growth and development of our country”.

Deol (2012)16
The author in this paper has discussed the background of GST proposed to be introduced in India. The
country has a federal government and indirect taxes contribute greatly to the revenues of the states. It is not
possible to introduce GST in India unless there is consensus within the states and centre. The author
37
discusses the advantages, the issues the states have with its implementation, etc. in the paper. The author has
also stated the ‘zero rating model’ for interstate sales. Under this model the exporting state dealer does not
charge any indirect tax on the sales. However, the importing state dealer declares all his imports and pays tax
on them in his state somewhat similar to an international reverse charge system operating currently. Under
this system the compliance is simpler and GST remains a destination based tax. Another option discussed is
the one like in Canada where the centre will distribute the federal GST on interstate sales based on equity.
However this model is ridden with problems and is highly unlikely. A charge of both CGST and SGST is
another model put forth in the paper. Further, the paper discusses how it is evident that introduction of GST
will definitely increase the tax base, reduce the costs of tax imbedded in prices of products and generally
increase the exports. Further, in relation to compliances the paper states that the registration, returns, etc. are
proposed to be PAN based and separate for centre and state. The paper concludes that introduction of GST
would be advantageous to Indian economy.

Dr C. J. Priya & Harsh , both, Assistant Professor, Vidya Vikas First Grade College, Mysore,
Karnataka, India,
Said in their research that, “Implementation of GST is one of the best decisions taken by the Indian
government. For the same reason, July 1st was celebrated as Financial Independence Day in India. The
transition to the GST regime which is accepted by 159 countries would not be easy. Confusions and
complexity were expected and will happen. India, at some point, had to comply with such regime. Though
this structure might be a perfect one but once in place, such a tax structure will make India a better economy
favourable for foreign investments. Until now, India was a union of 29 small tax economies and 7 union
territories with different levies unit to each state. It is a much accepted and appreciated regime because it
does away with multiple tax rates by centre and state”.

Ehtisham Ahmed and Satya Poddar (2009)

Studied, “Goods and Service Tax Reforms and Intergovernmental Consideration in India” and found that
GST introduction will provide simpler and transparent tax system with increase in output and productivity of
economy in India. But the benefits of GST are critically dependant on rational design of GST.

Garg (2014)
GST is the most logical steps towards the comprehensive indirect tax reform in our country since
independence. GST is leviable on all supply of goods and provision of services as well combination thereof.

38
All sectors of economy i.e. the industry, business including Govt. departments and service sector shall have
to bear impact of GST. All sections of economy viz., big, medium, small scale units, intermediaries,
importers, exporters, traders, professionals and consumers shall be directly affected by GST. One of the
biggest taxation reforms in India – the Goods and Service Tax (GST) is all set to integrate State economies
and boost overall growth. GST will create a single, unified Indian market to make the economy stronger.
Experts say that GST is likely to improve tax collections and Boost India’s economic development by
breaking tax barriers between States and integrating India through a uniform tax rate. Under GST, the
taxation burden will be divided equitably between manufacturing and services, through a lower tax rate by
increasing the tax base and minimizing exemptions.

Govind (2011)12
The author in the paper has discussed the current indirect tax system in India and its drawbacks, the benefits
of the proposed GST to be introduced in India and suggestions to improve the proposed laws. The author
states that given the various complexities of the current service tax legislation, the cascading effect of VAT
and the blocked input tax costs, it would be very necessary for India to introduce GST at the earliest. The
paper also analyses and discusses the proposed GST in India. Specifically the author has discussed the
proposed GST rates, exemptions, the dual system of GST, the issues envisaged therein, suggested solutions
for it, the administrative changes required for it, etc. The author has on these points compared the framework
in India with other countries where GST is already operational. The author has discussed the complexities in
the existing legislations around contentious issues like taxability of goods and/or services, taxing of renting
of property, interpretation of place of provision of services, what is included in services, etc. The author has
also stated that the most difficult issue in the GST implementation is the method of distributing the GST
between states and centre, the ITC rules for each, the returns administration for each and so on. However the
author concludes that even with all these difficulties GST is an important tax which would have far reaching
positive impact on the Indian economy so solutions to issues mentioned would need to be found and the tax
implemented. It is also essential to have a robust IT system in place and clarity of law before its
implementation.

Halakhandi:
(2007) GST was supposed to be introduced in India way back in 2010. It has been getting postponed due to
various reasons, major one being, getting to a consensus between the various states and the centre for
compensation. The author in the paper has discussed the existing laws in India for indirect taxes, the VAT

39
laws in various states with their advantages and disadvantages, the impact of the proposed GST, the
compliances under the proposed GST etc.
Jai Prakash (2014)
In his research study mentioned that the GST at the Central and State level are expected to give more relief
to industry, trade, agriculture and consumers through a more comprehensive and wider coverage of input tax
set off and service tax set-off, subsuming a several taxes in the GST and phasing out of CST. Responses of
industry and also of trade have been indeed encouraging. Thus GST offers us the best option to broaden our
tax base and we should not miss this opportunity of introducing GST when the circumstances are quite
favourable and economy is enjoying steady growth with only mild inflation
NCAER (2009)
In this paper, the authors have pointed out that the introduction of GST in India would lead to benefits like
increase in efficiency in use of energy, increase in general economic welfare, increase in the exports,
increase in the GDP, increase in the return on capital, optimum returns and allocation of the factors of
production, reduction in general price level, etc. The paper has stated how indirect taxes have always been a
major contributor in the GDP in India as compared to most countries forming a part of the study. Similarly
in India, indirect taxes form major part of the total taxes collected in the economy. The paper further states
that with the introduction of GST, resources would be used better; the tax could become environment
friendly. Further, the recommended rate for the comprehensive GST is 6- 10 %. It is also suggested that
there should be fewer taxes, most indirect taxes should be subsumed within the GST, and there should be
very few exemptions. The paper also studies the impact of the proposed GST on the imports, tax collections,
exports, etc.

Nitin Kumar (2014)

Studied, “Goods and Service Tax- A Way Forward” and concluded that implementation of GST in India
help will in removing economic distortion in current indirect system and is expected to encourage unbiased
tax structure which is indifferent to geographical locations.

Nishitha Gupta (2014)

In her study stated that implementation of GST in the Indian framework will lead to commercial benefits
which were untouched by the VAT system and would essentially lead to economic development. Hence
GST may usher in the possibility of a collective gain for industry, trade, agriculture, and common consumers
as well as for the Central Government and the State Government.

40
Suma C., Assistant Professor, T. John Institute of Management and Science, Bangalore, India
Said in her research paper “GST (A new tax regime)” that, “There was no proper transition of GST, due to
this many teething problems are in the society like GST software problems, frequent amendments in the tax
slabs etc. GST is a good Taxation system no doubt about it. But it should have been introduced after
complete preparation. GST will generate good revenue to the economy, but it should take care of Income
generation also”.

Shakwipee (2017),
A study conducted on enquiring the level of awareness towards GST among the small business owners in
Rajasthan state, found that the main areas to be focused include training errors and computer software
availability.

Times of India (26 July, 2017)

Page 1 & 17 it is stated that Sweet makers are confused with fixing the tax for their products as the
ingredients used in the sweets are taxed separately as raw material and the taxing of finished goods is
different. Plain sweet is taxed 5% but chocolate sweet is taxed at 28%. Plain sweet mixed with other dry
fruits is taxed at 12%. This taxing system makes Sweet makers to get confused on how much GST to be
fixed for which product.
Times of India (27 July, 2017), stated that the GST implication across different places for the same product
has wider differences which the consumers are unaware, resulting them in surprise. Eg: a Rasmalai sold at a
counter in a shop is taxed with 5% but if it is served in the hotel it is taxed with 18%, this has resulted in
difference of consumers shopping to purchase the similar products.

41
 CHAPTER 4.

DATA ANALYSIS AND INTERPRETATION

INTRODUCTION

The data collected through various respondent is primary data and efforts have been made to analyse and
interpret the statistic of what the common layman i.e the common people have to stay about pre and post
GST their experience and knowledge and also future thoughts on the same .The data has been collected
through google form and presented in the form of pie chart which is analysis thoroughly. The form has been
collected from various respondent.

A brief description of analysis and interpretation is given below.

4.1 AGE OF RESPONDENT: An attempt was made to know the age of respondent.

TABLE 4.1 AGE OF RESPONDENT

Sr. No Age Group No of Respondent Percentage

1 Below 18 2 3.9

2 18-25 34 66.7
3 25-50 11 21.6
4 Above 50 4 7.8
Total 51 100

SOURCE: FIELD WORK

CHART4.1 CLASSIFICATION OF AGE

42
Source: Field Survey

Interpretation:

From the above table and figure it is clear that majority of the respondent are between age group of 18-25
which is 66.7% whereas about 3.9% are the age group below 18 which is the lowest. Respondent between
the age group of 25-50 have a percentage of 21.6%. At last the age group below 50 have a 7.8% respondent.

4.2 GENDER 0F RESPONDENT : In the table given below an attempt was made to know the gender of
the respondent.

TABLE 4.2 GENDER 0F RESPONDENT

Sr. No Gender No of Respondent Percentage

1 Male 22 43.1
2 Female 29 56.9
Total 51 100

SOURCE: FIELD WORK

CHART4.2 GENDER OF RESPONDENT

Source: Field Survey

Interpretation:

In the above figure and the table it show the numbers of male respondent and female respondent who
responded to the project. There are total of 22 male respondent which brings them to 43.1%. Whereas total
count of female respondent are 29 with 56.9%.

43
 4.3 QUALIFICATIONS OF RESPONDENT: In the next table an attempt was made to know the
qualification of the respondent. This will make easy to classify to know whether they graduate, post-
graduate or under graduate

TABLE 4.3 QUALIFICATIONS OF RESPONDENT

Sr. No Qualifications No of Respondent Percentage

1 Graduate 22 43.1
2 Under Graduate 24 47.1
3 Post Graduate 5 9.8
Total 51 100
SOURCE: FIELD WORK

CHART 4.3 QUALICATION OF RESPONDENT

Source: Field Survey

Interpretation:

In the above table and the figure it is showing that the Under-Graduate have the highest number of
respondent which is 24 which leads to 47.1%. The least number of respondent is 5 in the Post Graduate
qualifications which has 9.8% and lastly for the Graduate section the number of respondent are 22 which has
43.1%

44
 4.4 OCCUPATION OF RESPONDENT:In the table provided below an attempt was made to know the
occupations of the respondent

TABLE4.4 OCCUPATION OF RESPONDENT

Sr. No Occupation No. of Respondent Percentage

1 Student 30 58.8
2 Employed 21 41.2
3 Unemployed Nil Nil
Total 51 100

SOURCE: FIELD WORK

What is Your Occupation?

CHART 4.4 OCCUPATIO OF RESPONDENT

Source: Field Survey

Interpretation:

In the above figure the respondent are been classified in on the basis of their occupation. We can see that
highest number of respondent are student with a total of 30 respondent and 58.8%. Then there are employed
respondent with total number of 21 which has a percentage of 4.2%. It was shocking to see in the survey that
there was no unemployed respondent.

45
 4.5 WHAT IS GST OR FULL FORM OF GST: In the table given below shows whether there
respondent know the full form of GST or not.

TABLE 4.5 WHAT IS GST OR FULL FORM OF GST

Sr. no What is GST No. of Percentage

Respondent
1 General Service Tax 3 5.9

2 Goods And Support Tax 3 5.9

3 Goods And Service Tax 45 88.2

4 Global Service Tax Nil Nil

Total 51 100
SOURCE: FIELD WORK

CHART 4.5 WHAT IS GST

Source: Field Survey

Interpretation:

From the above table and figure we can say that most of the people know the full form of GST which is
goods and service tax. 88.2% of respondent are the one who knows the full form. General Service Tax and
Goods And Support Tax have equally got 3 respondent which leads to 5.9%. Lastly 0% thinks that it is
Global Service Tax

46
 4.6 TAX RATE UNDER GST: In this segment an attempt was made to know whether the general public
know about the various tax rate under GST.

TABLE 4.6 TAX RATE UNDER GST

Sr. No Tax Rate No of Respondent Percentage

1 5% 12% 18% 31 60.8
2 12% 18% 7 13.7
3 5% 12% 18% 25% 12 23.5
4 5% 12% 1 2
Total 51 100
SOURCE: FIELD WORK

CHART 4.6 TAX RATE OR GST RATES

Source: Field Survey

Interpretation:

From the above figure and table we can classify that most of the respondent know that the tax rate is 5%
12% 18%. The number of respondent responded to this option is 31. Around 13.7% of respondent that is 7
thinks that tax rate is 12% and 18%. The second largest option of tax rate choose by the respondent was 5%
12% 18% and 25% around 12 respondent choose this option. The lowest option of tax rate chosen by the
respondent was 5% and 12% . The percentage of respondent choose this option is 2%.

47
 4.7 TYPES OF GST: The following segment shows the attempt which was made to know the types of
GST

TABLE 4.7 TYPES OF GST

Sr. No Types of GST No. of Percentage

Respondent
1 CGST and SGST 15 29.4

2 IGST and CGST 3 5.9

3 IGST and SGST 1 2
4 IGST CGST and SGST 32 62.7
Total 51 100
SOURCE: FIELD WORK

CHART 4.7 TYPES OF GST

Source: Field Survey

Interpretation:

From the above table and figure we can see that 2% respondent thinks that IGST and SGST are the only
types of GST which is the least number. We can see the huge number of respondent which is 32 who choose
the option of the IGST CGST and SGST with a 62.7% which is highest which is also the right option. From
the diagram we can also see that around 29.4% of people choose CGST and SGST and 5.9% which is 3
respondent choose that the IGST and CGST are the only types of GST.

48
 4.8 TAXES WHICH GOT REPLACED WITH GST: The below table and figure ask the respondent
about how many pre GST regime taxes got submerged under GST.

TABLE 4.8 TAXES WHICH GOT REPLACED WITH GST

Sr. No Taxes which got replaced with GST No. of Respondent Percentage
1 Service Tax 25 49
2 State VAT 21 41.2
3 Custom Duty 4 7.8
4 Entry Tax 1 2
Total 51 100
SOURCE: FIELD WORK

CHART 4.8 TAXES WHICH GOT REPLACED WITH GST

Source: Field Survey

Interpretation:

The indirect Taxes that got replaced by GST from the given option was Service Tax, State VAT and Entry
tax. 25 respondent thinks that service tax got replace with a highest percentage of 49%. 21 respondent also
thinks that sate VAT got replaced which gives us 41.2%. Entry Tax option is the lowest which was chosen
by 1 respondent. Last Custom Duty was chosen by 4 respondent with 7.8%.

49
 4.9 HAS BUSINESS SALES AFFECTED AFTER GST: The following question makes an attempt to
find out the respondent on whether they think that business sales have affected after GST or not. So
has sales increased or decreased.

TABLE 4.9 HAS BUSINESS SALES AFFECTED AFTER GST

Sr. No Has business Sales affected after GST No. of Respondent Percentage
1 Sales Increased 18 35.3
2 Sales Decreased 18 35.3
3 No Change 15 29.4
Total 51 100
SOURCE: FIELD WORK

CHART 4.9 HAS BUSINESS SALES AFFECTED AFTER GST

Source: Field Survey

Interpretation:

It is strange that equal number of respondent i.e 35.3% thinks that Sales has increased and same number of
respondent thinks that Sales has decreased. But we also see that around 29.4% thinks that there are no
changes in the business sales.

50
4.10 HOW WAS THE SHIFT OF GST: The following table and figure makes an attempt to know consumer
opinion on how the shift of GST regime was for them.

TABLE 4.10 HOW WAS THE SHIF OF GST

Sr. No How was the shift to GST regime No. of Respondent Percentage
1 Smoother 27 52.9
2 Difficult 22 43.1
3 Very Difficult 2 3.9
Total 51 100
SOURCE:FIELD WORK

CHART 4.10 HOW WAS THE SHIFT OF GST

Source: Field Survey

Interpretation:

As from the above diagram and table we can see that 52.9% of respondent thinks that the shift of the GST
regime was smoother. This percentage is highest among the other two options. We can also see that 22
number of respondent which is 43.1% thinks that the shift was quite difficult for them. The least number of
respondent that is 2 thinks that the shift of GST regime was very difficult.

51
4.11 HAS GST IMPLEMENTATION AFFECTED THE DEMAND OF GOODS AND SERVICES: This
question helps to know the consumer perception on whether GST introduction has affected the demand
for goods and services.

TABLE 4.11 HAS GST IMPLEMENTATION AFFECTED THE DEMAND OF GOODS AND SERVICES

Sr. No Has GST implementation has affected the No. of Respondent Percentage
demand for goods and services
1 Yes 31 60.8
2 No 6 11.8
3 Maybe 14 27.5
Total 51 100
SOURCE: FIELD WORK

Do you think that implementation of GST has affected the demand of goods and services?

CHART 4.11 HAS IMPLEMENTATION OF GST AFFECTED DEMAND

Source: Field Survey

Interpretation:

From the above table and chart we can see that 60.8% of respondent says that implementation of GST has
affected the demand of goods and services. 27.5% which is 14 number of respondent thinks that the demand
maybe have been affected. For the last we have 11.8% of respondent who thinks that demand for goods and
services have not been affected after the implementation of GST

52
4.12 HAS BUYING HABITS CHANGED AFTER GST: An attempt was made to know whether there is
any change in buying behaviour of consumer because of GST was put in place.

TABLE 4.12 HAS BUYING HABITS CHANGED AFTER GST

Sr. No Has buying habits changed after GST No. of Respondent Percentage
1 Increased 18 35.3
2 Decreased 9 17.6
3 No change 24 47.1
Total 51 100
SOURCE: FIELD WORK

CHART 4.12 HAS BUYING HABITS CHANGED AFTER GST

Source: Field Survey

Interpretation:

From above scenario we can say that 47.1% that is 24 respondent thinks that their buying habits has not
changed after the introduction of GST. 35.3% which is 18 respondent thinks that after introduction of GST
their buying habit have increased. Where least respondent which is 17.6%. thinks their buying habit has
decreased.

53
4.13WHO IS MOST AFFECTED BY GST: An attempt was made to know who was most affected by
implementation of GST at introductory stage.

TABLE 4.13 WHO IS MOST AFFECTED BY GST

Sr. No Most affected by GST No. of Respondent Percentage

1 Common man 33 64.7
2 Businessman 14 27.5
2 Other 4 7.8
Total 51 100
SOURCE: FIELD WORK

CHART 4.13 WHOS IS MOST AFFECTED BY GST

Source: Field Survey

Interpretation:

From the above table and chart we can see that respondents says that common man is most affected because
of GST with 64.7% respondents vote.

27.5% that is 14 respondents say that businessman was most affected because of GST and last 7.8% says
that others only got affected the most. Others can be from different occupation.

54
4.14 IS GST BENEFICIAR FOR INDIA: The following question gives us the brief of respondents whether
the GST is beneficial for India economy.

TABLE 4.14 IS GST BENEFICIAR FOR INDIA

Sr. No Is GST beneficial for India No. of Respondents Percentage

1 Yes 33 64.7
2 No 4 7.8
3 Maybe 14 27.5
Total 51 100
SOURCE: FIELD WORK

CHART 4.13 IS GST BENIFICIAL OR NOT FOR ECONOMY

Source: Field Survey

Interpretation:

From the above we can say that a whopping 64.7% of respondents thinks that GST is beneficial for India
economy which directly indicates towards the consumer or common people of India. We can also see that on
7.8% of respondent disagree with GST proving beneficial for India.

While 27.5% which is 14 respondents see it as maybe beneficiary reform for India.

55
4.15HAS GST REDUCE TAX INVASION AND MONEY LAUNDERING: The further question makes
attempt to know what common man thinks on GST whether it has reduced tax evasion and money
laundering or not.

TABLE 4.15 HAS GST REDUCE TAX INVASION AND MONEY LAUNDERING

Sr. No Reducing of Tax invasion and No. of Respondent Percentage

money laundering
1 Yes 19 37.3

2 No 20 39.2
3 Maybe 12 23.5
Total
SOURCE: FIELD WORK

CHART 4.15 HAS GST REDUCE MONEY LAUNDERING AND TAX INVASION

Source: Field Survey

Interpretation:

From the above table and figure we can say that 19 respondent that is 37.3% say that tax evasion and money
laundering has reduced while 20other respondent which is 39.2% thinks that tax evasion and money
laundering have not reduced due to application of GST.There are 12 respondents with 23.5% who also
thinks that it may or may not have reduced the tax evasion

56
4.16 HAS GST REDUCED TAX ON TAX: An attempt has been made to know whether GST has really
reduced tax on tax as it promise it would reduced .

TABLE 4.16 HAS GST REDUCED TAX ON TAX

Sr. No Has GST reduced tax on tax No. of Respondent Percentage

1 Yes 35 68.6
2 No 16 31.4
Total 51 100
SOURCE: FIELD WORK

CHART 4.16 HAS GST REDUCED THE CASCADING EFFECT OR TAX ON TAX

Source: Field Survey

Interpretation:

From the above table and chart we can assume that mostly people agrees that GST implementation has
reduced tax on tax as the number shows 68.6% of respondents which is 35 people thinks such. We have still
got 16 respondents who don’t agree with GST reducing tax on tax.

57
 CHAPTER 5
CONCLUSION

Implementation of GST is one of the best decisions taken by the Indian government and is considered as one
of the major tax reforms in India. For the same reason, July 1 was celebrated as Financial Independence day
in India when all the Members of Parliament attended the function in Parliament House. The transition to the
GST regime which is accepted by 160 countries would not be easy. Confusions and complexities were
expected and will happen. India, at some point, had to comply with such regime. Though the structure might
not be a perfect one but once in place, such a tax structure will make India a better economy favourable for
foreign investments. Until now India was a union of 29 small tax economies and 7 union territories with
different levies unique to each state. It is a much accepted and appreciated regime because it does away with
multiple tax rates by Centre and States and also the cascading effect of tax.
Good understanding among the consumers is important as it can generate positive perception of taxation
amongst them. Government should create awareness in understanding the rationale of this GST system. The
study highlights the views or common
The comparative study of consumer behavior pre-GST and post-GST reveals that the shift to a unified tax
system has had a significant impact on both consumer attitudes and purchasing behavior. Post-GST,
consumers have become more informed, price-sensitive, and confident in their purchasing decisions. The
standardization of tax rates has removed regional disparities, while the greater transparency in pricing has
contributed to more consistent demand. However, the varying impact of GST on different sectors means that
consumers' preferences and spending habits may continue to evolve as they adjust to the new tax structure
over time. The "tax on tax" system has long been a challenge, contributing to inefficiencies, increased costs,
and reduced market transparency. The shift to a single, value-added tax like GST has been a crucial reform
in addressing these issues, leading to a more efficient, transparent, and equitable tax system. By eliminating
the cascading effect of taxes, GST has not only benefited consumers but also helped businesses lower their
operational costs, ultimately promoting economic growth and a fairer tax environment.

The implementation of GST has helped reduce tax evasion and money laundering to a certain extent, though
it has not completely eradicated these issues. Below are the key ways in which GST has contributed to
reducing tax evasion and money laundering. GST law imposes stringent penalties and interest for non-
compliance, such as failure to file returns, underreporting sales, or claiming fraudulent input tax credits.
This has acted as a deterrent for businesses trying to evade taxes. There is also a mechanism for arrest and
prosecution in cases of large-scale tax evasion, especially when the evasion involves amounts above a
certain threshold. This has led to more vigilance and reduced the scope for businesses to engage in tax
evasion practices.

58
GST has led to the creation of specialized enforcement bodies and an improved regulatory framework to
monitor businesses and detect fraud. This includes the GST Intelligence Unit, which works closely with
other agencies to track suspicious transactions and identify potential cases of money laundering or tax
evasion. The introduction of a taxpayer profile system and continuous monitoring also makes it easier for
authorities to detect irregularities and prosecute offenders. As GST requires a digital trail for transactions,
there is less reliance on cash transactions, which are often used to hide income and avoid tax liabilities.
Businesses are encouraged to use digital payments and maintain proper invoicing to claim input tax credits.
This has indirectly helped in reducing money laundering activities, as large cash transactions are now more
easily tracked and scrutinized by authorities. While GST has made it harder to conceal transactions and
evade taxes, it is not a complete solution to money laundering. Money laundering often involves more
sophisticated methods, including layering of transactions, shell companies, and cross-border transactions.
However, the enhanced tracking and reporting systems, along with the cooperation between GST authorities
and other law enforcement agencies (like the Enforcement Directorate), have made it more difficult for
businesses to launder money through fake invoicing or unreported sales.

While GST has significantly improved the transparency and accountability of the tax system, thereby
reducing tax evasion and making money laundering more difficult, it is not foolproof. There are still avenues
for tax evasion, especially in sectors with cash-heavy transactions or where regulatory oversight is weaker.
However, the systemic changes brought about by GST, particularly its digital infrastructure, input tax credit
system, and regular monitoring, have made it considerably harder for businesses to evade taxes and engage
in illicit financial activities. As enforcement continues to improve, the impact of GST on reducing tax
evasion and money laundering will likely increase over time.

The implementation of the Goods and Services Tax (GST) has had a significant impact on various sectors of
the economy, and different groups of people have experienced its effects differently. Here's a conclusion on
who is most affected by GST. SMEs are arguably the most affected by GST, especially those that were
previously operating in the informal sector or did not maintain proper records. Before GST, many small
businesses were able to avoid the complexities of taxation and operated under lower tax burdens, often
without having to deal with formal invoicing or compliance.With GST, businesses must comply with
detailed tax filing, record-keeping, and reporting requirements, which can be burdensome for small-scale
operations that lack resources for tax compliance. Many SMEs also face difficulties in understanding the
new tax system and the process of claiming input tax credits, which can be complex and time-consuming.

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Consumers have been affected in varying degrees, depending on the sector. Positive Impact Some goods
and services saw a reduction in prices due to GST, especially for products that were previously taxed under
multiple layers of indirect taxes (like excise, VAT, and service tax), leading to cascading effects. The
introduction of a single tax system helped streamline prices and make them more transparent. Negative
Impact However, several goods and services, particularly luxury items, real estate, and certain consumables,
saw an increase in taxes. In some cases, this increased cost was passed on to consumers, leading to higher
prices. Some lower-income groups found the rise in essential goods' prices (like food and healthcare)
burdensome. Vulnerable Group Lower-income households, which spend a higher proportion of their income
on essential goods and services, may have felt the adverse effects more acutely, as some of these goods
became more expensive under the new tax regime. In conclusion, small businesses, informal sector workers,
low-income consumers, and businesses with complex multi-state operations are among the most affected by
GST. Small businesses struggle with compliance costs, while consumers, especially from lower-income
groups, may feel the strain from price increases on essential goods and services. On the other hand,
businesses that adapt to the new system, particularly large-scale ones, are likely to benefit from the
efficiencies and tax credit mechanisms introduced by GST.

While GST has brought about substantial benefits in terms of streamlining taxation, improving transparency,
and curbing tax evasion, the short-term disruptions, especially for smaller businesses and the informal sector,
have had significant consequences. Over time, however, as compliance becomes more widespread and
businesses adapt to the system, these challenges are likely to lesson.

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 BIBLIOGRAPHY

Books:

Indirect Tax- Introduction of Goods and Services Tax (Manan Publication).

Indirect Tax- Introduction of Goods and Services Tax (Sheth
Publication).

Websites:
For Literature Review:

https://shodhgangotri.inflibnet.ac.in
http://www.imperialjournals.com
http://www.ijtsrd.com
https://www.slideshare.net

For rest of the Project:

https://www.gstindia.com
https://www.britannica.com
https://www.wikipedia.com
www.cleartax.com
www.gstgov.in
www.indiafilings.com
www.gstcouncil.gov.in
www.cbec.gov.in
www.gstn.org

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 APPENDIX

1. Name of the respondent

_______________________

2. What is your age?

 Below 18
 18-25
 25-50
 Above 50

3. What is your Gender?

 Male
 Female

4. What is your qualification?

 Graduate
 Under-Graduate
 Post-Gradute

5. What is your occupation?

 Stundent
 Employed
 Unemployed

6. According to you what is GST?

 General Service Tax
 Goods And Support Tax
 Goods And Service Tax
 Global Service Tax
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7. What are the GST rate under GST ?
 5%, 12%, 18%
 12%, 18%
 5%, 12%, 18% & 28%
 5% & 12%

8. What are the various types of taxes which got replaced with GST
 CGST & SGST
 IGST & CGST
 IGST & SGST
 IGST, CGST & SGST

9. What are the various taxes that got replaced with GST?
 Service Tax
 State VAT
 Custom Duty
 Entry Tax

10. According to you how was the shift of GST regime?

 Smoother
 Difficult
 Very Difficult

11. Do you think that implementation of GST has affected the demand of goods and services?
 Yes
 No
 Maybe

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12. According to you has the business sales affected after the implementation of GST?
 Sales Increased
 Sales Decreased
 No Change

13. Have Your Buying Habits Changed After Introduction Of GST?

 Increased
 Decreased
 No Change

14. Who is most affected by GST?

 Common Man
 Business Man
 Others

15. Is The GST Beneficial For The Indian Economy?

 Yes
 No
 Maybe

16. Do You Think That After GST Introduction The Tax Evasion And Money Laundering Have Reduced?
 Yes
 No
 Maybe

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17. According To You Has GST Reduced The Tax On Tax?
 Yes
 No

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