India is set to embrace a new taxation framework, GST. Several experts from various walks of industry have claimed that the move will benefit the country and its businesses on a variety of fronts. As we all know that GST (Goods and Services Tax) regime would pave way for common national market, some experts have claimed that it will be nothing less than a blessing for small traders that prefer performing all commercial activities, business functions, and so on within the boundary of their states. As a matter of fact, economists have even mentioned that the common national market will help the small traders achieve unprecedented growth within a few years once the country gets migrated into new indirect taxation regime. Through this blog, we would learn how the common national market will benefit small traders.
What is a common national market?
It can be described as a type of trade bloc which is not categorized into various jurisdictional controls. In simple words, it is a market where all the businesses, from different states and union territories, can easily compete with each other. With the introduction of GST in India, it is so obvious that traders across the country would be offered a common national market, where they can promote their brands and offerings. The concept of common national market was envisioned primarily to ensure free movements of all the goods and commodities across the countries.
At present, all the traders in the country have a common concern that they are forced to operate within a limited area of market bloc. They claim that owing to numerous complications and jurisdictional requirements associated with performing inter-state transfer of goods and commodities, they prefer performing most of the commercial transactions within their states. It is so true that whenever a business firm plans to transfer its goods to any outside state, then it has to undergo through cumbersome task of getting the licenses and approvals. What is even more frightening for traders is that they have to face numerous challenges associated with compliance for any sort of inter-state transfer of goods. This not only exposed them to numerous non-compliance upshots, but also forces them to interact with officials of various taxation authorities of different states quite regularly. All these actually opened the door for harassment and corruption. It is so obvious that large players across the industries can easily tackle such challenges; however, small businesses often fall prey to such complications. Herein, the introduction of GST in Indiawould ensure justice to such traders who could not tackle the issues related to inter-state supplies of goods and commodities.
Let’s take a look at some compelling benefits that common national market ensures for small businesses.
Simplified rules related to inter-state transfer of goods: Simply put, small traders see this as the most beneficial aspect of GST regime. The complications associated with transfer of any goods across states are really a grave concern for small businesses presently as it is quite a complicated process. Such commercial activities attract hefty amount of taxes, and it also opened the door for harassment of small businesses. However, as most of the compliance functions related to inter-state transfer of goods would be performed through GST Portal now, it will actually pave way for simplifications of rules related to inter-state transfer of goods.
Penetrate in remote target markets quite easily: Presently, numerous small traders fail to capitalize on the opportunities in remote target markets primarily because they are forced to perform all commercial activities within their states. With the introduction of GST in India, it would be a thing of the past! GST would allow small traders and business firms penetrate deep in their target markets even if they are in remote states.
Compete with major players across the country: This is yet another benefit that GST offers for traders operating at small scale. They complain that the taxation structure in India actually favors strong and big players, and therefore, they have always sought some modifications in laws. Herein, the arrival of GST is actually good news for them as it can allow them to compete with big business firms and major players across the country.
In short, once GST is implemented, small businesses can perform all compliance related activities through the GST portal and explore all the growth opportunities in the common national market.