Impact of GST and Demonetization on Online Shopping in India

In November 2016, the government of India took a sensational decision with Rs. 500 and Rs. 1000 notes demonetization.  Due to this decision many economical and social changes happens. The country financial and marketing status somewhat gone back. Then after few days we came to previous position. The government has been telling there will be huge impact and the GDP will grow up due to this, but in practical it was not successful and people are facing the same situation as compared to before demonetization.

Again in the month of July 2017, the government of India has implemented a new tax system called “Good and Service Tax (GST)” with the concept of one nation one tax. For this government given huge publicity and started implementation. According to GST there are 5 Tax slabs with 0%, 5%, 12%, 18% and 28%. Prime Minister Mr. Narendra Modi and Finance minister Mr. Arun Jaitley announced that this initiation will give huge results and it is going to change the life style of people of India, and we are going to achieve good economic growth and the prices of daily needs will come down. Now almost 40 days over, we will see how the situation is? Are there any tremendous changes or not?

In starting days all people hope that something will happen with GST but after these 40 days people are feeling that this is not working out and we are spending more money compared to previous tax system. Here I am giving a small example, before GST if you bought any product, you were paying the less or same as MRP (which includes all taxes) but now almost all retailers are collecting more than MRP and they are telling price will be post GST. And before GST if you ate anything in restaurants you were paying less but now it is more. At the same time if you observe the prices of daily needs before 30th July and now you will come to know that the prices are more now. So by observing all these things we can state that GST is failing to reach government expectations.

Few state governments are going to fight against GST, they already started asking to stop GST for their state, few are asking for few projects or schemes of state. Telangana chief minister Mr. K Chandra Sekhar Rao (KCR) is first in that list. So soon some disturbances will occur in the country against GST. Now we will check how the online business after demonetization and GST.

After demonetization all educated people started using online transactions, e-wallets to pay, to buy, to transfer money. So there is good impact of demonetization on online payments. So people started using online shopping and online payments, due to this online shopping or online business is growing up. Now we will see the situation after GST, after GST implementation people are facing many problems with retailers and supermarkets. They don’t know the exact price of the product before payment, but in online it is showing the exact price including GST. If I know the final price, if it is in my budget I can buy otherwise I can skip, so this is the most attractive thing in online shopping. So due to accurate prices people are using online shopping more.

So finally we can state that after demonetization and GST, the usage of online shopping and online transaction has been increasing in India.