GST: India Vs Other Countries

No one is a stranger to the new Goods and Services Tax(GST) regime that was launched on 1^st of July all across the country. However, not everyone knows that the concept of GST is not actually new. In 1954, France became the first country in the world to successfully implement GST. However, soon afterward other countries also followed suit. Today, more than 150 countries are using the GST model but how does India stack up against them?

Let’s take a look at four powerful economies that have implemented GST including India:

India

The four standard rates of GST in the country are 5%, 12%, 18%, and 28%. Although there are some items on which a 0% rate is levied. Taxpayers are supposed to file three monthly returns and one annual return and the threshold exemption limit is Rs. 20 lakhs.

UK

In the UK, where GST is called Value Added Tax, the standard rates are 20%, 5%, and 0%. Returns are to be quarterly but small businesses can file annually. The threshold exemption limit is £ 73,000 or Rs. 61 lakhs.

Singapore

In Singapore, there is just one standard rate for GST which is 7%, except for the zero rate. Returns are to be filed quarterly in most cases. Threshold exemption limit is $ 1 million or Rs. 4.8 crore which is probably the highest of all.

Canada

Canada has Federal Goods and Service Tax(GST)& Harmonized Sales Tax. The former has just one rate of 5% and the latter varies from 0% to 15%. Returns in the country are to be filed on monthly, quarterly, on annual basis depending on the turnover. The threshold exemption limit is 30,000 Canadian Dollars or Rs. 15.6 lakhs.

Clearly, compared to other countries the tax rates in India are higher. However, they are still arguably better than the old regime. So, at any rate, that’s one step forward.