New Delhi, July 1 (IANS) India’s Goods and Services Tax (GST) system has emerged as one of the biggest success stories in the last decade, reflecting a growing formal economy and rising compliance, noted economist and former IMF Executive Director, Dr Surjit Bhalla, said on Tuesday.

In an exclusive interaction with IANS, Bhalla highlighted that GST has not only increased tax revenue significantly but has also brought more businesses and individuals under the formal tax net.

“The GST has performed well, and more individuals have entered the formal tax net. That’s a good sign,” he said.

Bhalla told IANS that the Indian economy has done “reasonably well” since the implementation of GST in 2017-18, replacing the earlier value-added tax system.

“It’s one of the big success stories over the last ten years,” Bhalla said, attributing the positive outcomes to stronger compliance, greater efficiency, and broader coverage of the tax base.

“Both within and outside the government, it is acknowledged that the economy has done reasonably well, and GST, having replaced the value-added tax, has contributed positively,” the famous economist said.

While Bhalla acknowledged the potential for further reforms in GST to make it simpler and more growth-friendly, he emphasised that the current tax structure has already laid a strong foundation for India’s future economic trajectory.

Commenting on India’s rising global stature, Bhalla pointed out that India has now become the fourth-largest economy in the world and is the fastest-growing among major economies.

He said that with improved education and healthcare leading to higher productivity, India is well-positioned to achieve even stronger growth in the coming years.

On the recently launched Operation Sindhu Sudarshan, Bhalla called it a very positive step, adding that enhanced defence preparedness contributes to both national security and economic confidence.

“Defence is a core national priority. More defence spending leads to more security and strengthens the economy. This operation will help both defence preparedness and economic confidence,” he maintained.

–IANS

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