New Delhi: As the Goods and Services Tax (GST) enters its tenth year on July 1, the focus is shifting from implementation to efficiency, with the Union Government increasingly leveraging artificial intelligence, data integration and process simplification to make the tax regime more taxpayer-friendly.
A decade after its rollout, GST has emerged as one of India's most significant economic reforms, broadening the tax base, improving compliance and boosting revenues while fostering greater formalisation of the economy.
Introduced on July 1, 2017, GST replaced a complex web of 17 central and state taxes and 13 cesses with a unified indirect tax system, creating a common national market and reducing cascading taxes.
The registered taxpayer base has expanded from 66.5 lakh at launch to around 1.6 crore in 2026, underlining the growing formalisation of businesses.
As the tax system matures, authorities are increasingly using technology to simplify compliance, particularly for micro, small and medium enterprises (MSMEs). Integration of GST, income tax and customs databases is expected to improve risk assessment, curb tax evasion and reduce manual intervention.
The reform, launched at the stroke of midnight on July 1, 2017, in the Central Hall of Parliament, followed years of negotiations between the Union and state governments. Then finance minister Arun Jaitley played a pivotal role in building consensus for the landmark reform.
GST initially adopted a four-tier rate structure of 5, 12, 18 and 28 per cent, with a cess on luxury and demerit goods. In September 2025, the regime transitioned to a next-generation two-tier framework, with most goods and services now falling under either the 5 per cent or 18 per cent slabs, while luxury and demerit items attract a 40 per cent rate.
The simplification of rates, according to Finance Minister Nirmala Sitharaman, is aimed at reducing prices and leaving more disposable income in consumers' hands.
GST revenues have also recorded steady growth. Average monthly collections have risen from Rs 89,700 crore in 2017-18 to Rs 1.85 lakh crore in FY26. Gross GST collections increased 8.3 per cent year-on-year to Rs 22.27 lakh crore in 2025-26.
Despite the progress, some structural issues remain unresolved. Petroleum products such as petrol, diesel, crude oil, aviation turbine fuel (ATF) and natural gas continue to remain outside the GST framework, with states yet to arrive at a consensus on their inclusion.
Industry feedback, however, remains largely positive. According to a recent Deloitte survey, 99 per cent of businesses reported either a positive or neutral experience with GST, citing digitisation and rate rationalisation as key benefits.
Experts believe the next phase of GST reforms should focus on AI-driven compliance, data-led dispute resolution and further simplification to create a seamless and efficient tax ecosystem.
(With agency inputs from PTI)