Book Review: 1 Nation, 1 Tax, 1 Market - Goods and Services Tax - The Road Ahead

Dr. Megha Agarwal has recently published “Goods and Services Tax – The Road Ahead”. This book is structured as a compilation of individual focused pieces that as a whole, stand to provide the reader a well laid and thorough understanding of how GST would transform the economic landscape of India. The author has carefully curated material and has brought in the best into this compilation. The book is split into 17 chapters, individually authored by a host of leading luminaries of industry. This Book was written before the GST Act was passed in the Parliament.

It appears that the author had a specific vision for how this book would ultimately unfold. Although the chapters are precisely focused, they contribute to the overall flow of the book. At the same time, the pieces reveal key industrial insight of the impact of the current tax regime and the probable reaction of the industry to the shift into the new system. Some pieces take it one step further by exploring limitations, redundancies and difficulties that the industry is likely to face.

Reading the articles, the first observation is that the authors are well-versed with the Model GST Law. They critically analyze specific provisions and explore the extent it will affect the industry. Remarkably, the authors have already developed ideas on overcoming certain challenges with the new GST. Other authors have undertaken a comparative analysis of India in relation to other countries which have a single tax regime. From this, they have developed propositions that highlight the drawbacks of India’s GST and the mammoth challenge ahead for the administration to implement and successfully maintain this GST system.

At the time of writing this review, the Parliament has enacted the GST Laws. The Draft Rules have been prepared and are close to finalization. It is noteworthy that even before the GST has been implemented, there are volumes and countless pages of material on the subject, ranging from in-depth commentaries to short quips. Having personally gone through a wide range of content on the subject, I have found nothing remarkable. For most of the material, it is a regurgitation of the laws itself, without any critical, analytical or explanatory thought. The layman would be confused by reading the model bare act, but he would remain just as confused by reading a commentary on it as well. It is for this reason that I was compelled to appreciate this well curated book. While catering to the common individual, it contains a well of insight. It is a perfect piece for a person to begin the course of study into GST.

One will not find a line by line analysis of the GST Law in this book. That is not the intent of the author. This book is structured such that the reader understands the philosophy behind the Law, the overarching principles, and the impact it will stand to have on the economy. For example, a recurring theme prevalent in nearly all chapters is that the erstwhile complex and intricate indirect tax regime was specifically formulated, corrected and implemented to cover all ambits of the Indian business sector. It was fine-tuned over time to maximize the efficiency and potential of every individual industry. Struggling industries were given lax tax frameworks, whilst highly profitable and lucrative sectors drew comparable income for the exchequer. Indeed, it was complex and not everyone could understand it. But it was not designed for everyone to understand. Tax Experts have been ever ready to interpret and apply the laws, rules, notifications and circulars.

With a goal of simplification, the industries become subject uniformity. While equality for all proposition may appear attractive, it is misplaced. Because the industries and inherently unequal and at different footings. A singular and uniform system cannot be applied to them.

At this juncture, I must appreciate the calculative analysis of Dr. Agarwal. She has limited each article to what appears to be around 5000 words. This ensures that the reader remains engaged and the information and arguments developed in each article are tightly packed. Without going through voluminous records, the reader is able to quickly grasp the underlying concepts, understand the propositions of the authors and surmise each piece for its merit. The authors have carefully structured their piece to ensure completeness. The pieces are generally empirical, experiential and neutral. There is a recount of the practicalities of the law, rather than pure literary analysis. This is perhaps what makes this compilation more compelling to the reader.

Having gone through the collection of works compiled by Dr. Megha Agarwal in “Goods and Services Tax – The Road Ahead”, I find it necessary to specifically discuss the outstanding piece. Whilst each article is meritorious in its own right, one Article stands miles ahead of the rest.

Chapter 10 is titled ‘Impact of GST on the Power Sector’. It is authored by Dr. Rajib K Mishra, Director, PTC India and Senior Advocate Ashok Panda. The authorial combination is perfect. Senior Advocate Ashok Panda is a leading Supreme Court Advocate in Tax Laws and Dr. Rajib K Mishra is the head of one of the largest players in the Power Industry. This mixture of expertise has allowed for the article to mark itself separate from others.

Delving into the article, it is pertinent to note that the legal sphere of the power industry is as complex, intricate and entangled as the power lines the cross cut cities and homes. The tax laws governing this industry adds another dimension of complexity. The authors, however, have carefully designed the piece such that the reader is first introduced to the power industry, laws governing it and the institutional framework therein. The authors then explain and explore the various tax indices prevalent in the present structure. They further conduct an empirical examination of the impact of tax on the factors of production. The authors then proceed to assess the overall impact of GST on the cost on production, and compare it with the present regime. There is an insightful discussion on the possible distribution of costs. Finally, the author examines the power sector from an international perspective. The statements, propositions and analysis are buttressed with well-placed visual representations. In a span of 15 pages, the reader becomes fully versed with the legalities of the power sector, and has gainful understanding of the tax regime therein.

 Overall, I would recommend this book as necessary read for anyone who is entering study into the realm of GST. Completing this short book, one will have a firm understanding of the law and concepts behind GST, and be ready delve into serious analysis of the law passed by the legislature. For the layman also, this short book will equip him with all the necessary knowledge about GST. He need not look or research any further for a strong and firm understanding of GST.