Implementation of GST in Tier - III Cities of India: Evidence from SMEs of the Itanagar Capital Region

Abstract

The Goods and Services Tax Act, 2017 is perhaps the most revolutionary indirect tax reform in India. The main objective behind its implementation is to create an uniform tax system by eliminating dozens of Central and State levies or taxes in the country and making India “One Nation One Tax” eco-system. GST is able to provide transparency, certainty and simplicity in the new order of tax system. This study has attempted to study the awareness and adaptation level of GST among the small and micro enterprises and also shed light on the dynamics of GST implementation in Itanagar Capital Region (ICR), representing one of the three tier cities of India. The study has revealed that the association of demographic variables of the owners of the SMEs became mostly insignificant excepting the level of education as far as the awareness and adoption of GST implementation is concerned in the study region. The study has also indicated that GST being new generation tax eco-system, the age and experiences in the field of the selected respondents-SME owners did not provide any significant benefits or ease of use while implementing GST in the study region. The study outcomes highlight that there is need for continuous State supported interventions in sensitizing and upgrading GST oriented knowledge and skills among the owners of SMEs specially operating in Tier III cities of India.