Introduction
Launched on July 1, 2017, India’s Goods and Services Tax (GST) marked a seismic shift in the country’s indirect tax regime. Eight years on, it has become the backbone of India’s fiscal architecture—unlocking unified markets, boosting compliance, and transforming state-centre dynamics. Yet, GST remains a work in progress, with persistent challenges reminding us that reform is a journey, not a destination.
This Manika TaxWise article dives deep into the dual narrative of growth and glitches, exploring achievements, friction points, reform milestones, and practical guidance for businesses and individuals navigating GST today.
▶️ Section 1: GST by the Numbers – A Growth Story
🔹 Revenue Boom
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Record ₹22.08 lakh crore gross collections in FY 2024–25—nearly double FY 2020–21 levels of ₹11.37 lakh crore
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Average monthly collection reached ₹1.84 lakh crore in FY 25
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Net collections: around ₹20 trillion—three times the pre-GST era
🔹 Taxpayer Base Expansion
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Registered taxpayers swelled from ~60 lakh (2017) to 1.51 crore active filers by April 2025
📈 Section 2: Gains – Eight Reasons to Celebrate
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Unified Tax System
Eradicated overlapping central and state taxes—ushering in ‘One Nation, One Tax’ -
Online-Compliances & Transparency
Digital invoicing, return filing, and auto-population cut red tape and reduced corruption -
Input Tax Credit (ITC) Revolution
Multi-stage tax credit system virtually eliminated tax cascading -
Boost to SMEs & MSMEs
Transparent GST trails empower lenders to assess creditworthiness, unlocking digital loans -
Efficiency in Trade and Transport
Removal of interstate check-post delays reduced transit times by ~20% -
Revenue Formalisation
Enhanced compliance enriching government coffers and maintaining fiscal discipline . -
High Industry Confidence
Deloitte reports show rising corporate confidence—from 59% (2022) to 85% (2025) -
Ease of Doing Business
Streamlined processes improved India’s global business rankings and investor interest .
⚠️ Section 3: Lingering Pains & Challenges
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Multi-Slab Rate Complexity
Confusion persists across 5–6 tax slabs (0%, 5%, 12%, 18%, 28%), often causing classification errors en.wikipedia.org. -
ITC Hurdles & Fake Invoices
Input credit mismatches due to delayed invoices and credit bogus entries -
Compliance Overload
Multiple monthly/quarterly filings (even 25 returns/year for large firms) strain administrative resources india-briefing.com. -
Technical Glitches & GSTN Outages
Portal downtimes and filing disruptions unreliable for small businesses . -
Appeals & Tribunal Deadlock
With GST Appellate Tribunals yet to be fully operational, legal battles stall -
Jurisdictional Friction
Conflicts between CGST and SGST authorities over classification and enforcement -
Petroleum & Alcohol Outside GST
State-exempt VAT on key products fragments the single market newindianexpress.com. -
Strict Notices & Time Limits
Scrutiny notices under Section 74(A) misused, and returns time-barred after 3 years—causing compliance anxiety .
🌱 Section 4: GST 2.0 – Reform Road Ahead
| Priority | Proposed Reform | Status/Suggestion |
|---|---|---|
| Rate Rationalisation | Merge 18% & 12% slabs → one ~15% slab | Group of Ministers recommending |
| Simplified Appeals | Activate GST Tribunals (late 2025) | In final stages |
| Expand GST Base | Include petroleum, alcohol, real estate | Under policy review |
| Plug ITC Loopholes | Strengthen invoice matching, tracking tech | Ongoing state/federal coordination |
| Ease SME Filing | More QRMP automation, extended windows | QRMP reforms reduce burden |
| GSTN Infrastructure | Adopt AI tools, increase uptime | Govt exploring advanced tech |
| Timeout Relief | Review time-bar red tape, narrow Section 74A misuse | Experts urge urgency |
📝 Section 5: Practical Tips for Businesses & Taxpayers
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Automate GST Returns using e-invoicing and billing software—save time and reduce error.
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File under QRMP for turnovers ≤ ₹50 mn—to ease compliance hours.
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Reconcile monthly ITC to avoid mismatches and ensure smoother credit claims.
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Track notices closely—especially Section 74A, and contest misuse or misclassification early.
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Keep abreast of upcoming slab merges and tribunal notifications—they impact filings.
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Seek expert help for complex credits, litigation, or classification disputes.
✅ Conclusion
India's GST has been a landmark reform, building a unified national tax structure, empowering MSMEs, and creating enormous revenue growth. Still, reform fatigue lingers—GST needs further simplification, technological resilience, broader tax coverage, and fair dispute resolution.
As we turn the page to GST 2.0, the focus must shift to rate rationalization, tribunal activation, ITC clarity, and inclusion of key sectors. For businesses and individuals alike, staying compliant, leveraging digital tools, and anticipating reforms are the keys to thriving under this evolving regime.
❓ FAQs
1. What is GST and why is it important?
GST is a value-added tax replacing multiple indirect taxes on goods and services. It simplifies compliance, reduces cascading taxes, integrates markets, and enhances transparency.
2. What are the main benefits witnessed after 8 years?
• Unified tax structure • Digital compliance • Revenue boom (₹22 lakh crore in FY 25) • Stronger credit for SMEs • Improved ease-of-doing-business.
3. Why are multiple tax slabs a problem?
Multiple slabs cause confusion, misclassification risks, and frequent revisions—leading to compliance errors and administrative burden.
4. What issues are unresolved in GST?
Persistent challenges include ITC mismatches, technical portal inefficiencies, delayed tribunal setup, exclusion of petroleum and alcohol, and strict audit notices.
5. What changes are expected in GST 2.0?
• 15% unified slab via rationalization • Tribunal operationalization by late 2025 • Expansion to petroleum and alcohol • Stronger ITC tracking • Relief in audit procedures.
6. How can businesses stay GST‑compliant?
Use automated systems, opt for QRMP, reconcile invoices monthly, monitor notices, and consult professionals for complex issues.
