will indian expats gain from goods and services tax
Last Updated : GMT 09:07:40
Egypt Today, egypt today
Egypt Today, egypt today
Last Updated : GMT 09:07:40
Egypt Today, egypt today

Will Indian expats gain from Goods and Services Tax?

Egypt Today, egypt today

Egypt Today, egypt today Will Indian expats gain from Goods and Services Tax?

Indian Expats are dominant investors in the real estate sector.
Dubai - Egypt Today

There are great expectation from India's biggest tax reform since independence. A tangled web of levies at the central and state levels is being scrapped to make way for a single tax regime to turn the country into a single market from Saturday.
The move is monumental and the introduction of the Goods and Services Tax (GST) was commemorated by a midnight session in Parliament on the lines of the Freedom at Midnight session in 1947. It is not just resident Indians who will benefit from the move, expats could also gain from this reform. Investment in real estate could turn out to be more attractive with this tax and the introduction of Real Estate Regulation Act (RERA).
"NRIs looking at buying apartments (not land) are likely to find that builders will be able to pass on the GST benefit, thereby reducing prices by a few per cent," said Veer Sardesai, a Mumbai-based financial planner.
Indian Expats are dominant investors in the real estate sector.
In fact, UAE-based Indian expatriates are very active and are known to have pumped in $1.69 billion in the first nine months of 2016. NRI investments are expected to touch $11.5 billion this year, notes a market report by Square Yards.
GST is also expected to make the Indian economy more transparent by reducing the black economy substantially. This will help NRIs in purchasing items. Processes are likely to be more transparent, and would make it easier to do business in the country. However, there could be hiccups in the initial phases with several forms to fill and wading through a range of tax slabs. Businesses would have to file 37 annual tax-fillings - at three a month and one annually.
"NRI business people would have to review how they run their businesses due to the impact of GST as the impacts will vary by sector," says Vishal Dhawan, CEO of Plan Ahead advisory services with offices in India and the UAE.
This would mean they have to pay more for financial advice. "For businesses that operate out of multiple states, there may be a need to register in different states, once again increasing compliance needs in the short term," says Dhawan.
But there are benefits, too. "NRIs on leaving India may be able to claim the GST refund, thereby making their purchases in India cheaper. However, it might take a few months before that is possible, as the government could take some time to set up counters at the airports," said Sardesai.
Wealthy NRIs, who would like to own and maintain luxury cars in India, will find it cheaper to buy them. In contrast, dining out or purchases of smaller cars or smartphones that are not manufactured in the country will be more expensive.
NRIs will also have to pay more for currency exchange and other banking services since the taxes on these have hiked three per cent. "Currently, the service tax is charged at 15 per cent. Under GST, the applicable rate is 18 per cent. Other financial services such as brokerage fees buying or selling investment will also be similarly affected," adds Sardesai.
Overall, it is a significant shift, and once the dust settles, these reforms should boost growth with significantly higher tax collections. Currently, India's tax collection ratio to GDP is among the lowest in the world. "Even though there are multiple rates at present, and a few hiccups for small and medium enterprises, overall it is very good move. And would result in a positive impact on growth and inflation in the long run," says Rupa Rege-Nitsure, Group Chief Economist, L&T Financial Services.


source: Khaleejtimes

 

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will indian expats gain from goods and services tax will indian expats gain from goods and services tax



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