Chapter 1.

Introduction

1.1 Concept and Introduction of Tax:

Taxation is the inherent power of the state to impose and demand contribution upon persons,
properties, or right for the purpose of generating revenues for public purposes.
Taxes are enforced proportional contributions from persons to property levied by the law making body
of the state by virtue of its sovereignty for the support of the government and all public needs.
1.2 Brief History of Taxation:
Tax is today an important source of revenue for the government in all the countries. More than 3000
years ago, the inhabitants of ancient Egypt and Greece used to pay tax, consumption taxes and custom
duties. Income tax was first introduced in India in 1860 by James Wilson who become Indians First
Finance Member.
In order to meet the losses sustained by the government on account of military mutiny of 1857. In 1918
A New Income Tax bill was passed and which was further again replace in 1922. Finally, The Ministry
of Law and Finance The Income Tax was passed in 1961 and brought came in force on 1st April 1962
and this is also known as the Financial Year in Current Era. I e. (01.04.18 – 31.03.2019)
1.3 Taxation System:
Tax system of raising money to finance Government. All governments require payment of money
taxes from people.
Government use revenues to pay soldiers and police to build dams and roads, to operate schools and
hospitals, to provide food to the poor and medical care facilities etc. and also hundreds of other
purposes without taxes to fund its activities, government could not exist. So, taxation is the most
important source of revenues for modern government typically according for 90% or more of their
income.
1.4 Essentials Characteristics of Tax:
1. It is an enforced Contribution.
2. It is generally payable by Money.
3. It proportionate in character, usually based on ability to pay.
4. It is levied on person and property with the jurisdiction of the state.
5. It is levied for public purpose.
6. It is commonly required to be paid a regular intervals.

1
1.5 Why are Taxes Levied?
The reason for levy of taxes is that they constitute the basic source of revenue to the government.
Revenue so raised is utilized for meeting the expenses of government like defence, provision of
education, health care, Infrastructure facilities like roads, dams etc.
1.6 What are the Reasons of Taxation?
1. Provide the basic facilities for every citizen of country.
2. Finance government multiple projects and schemes.
3. Protection of Life.
4. Responsibility of citizen to the Nation.
1.7 Meaning of Tax:
The word Tax came from Latin word “Taxo, Tax are '' which means to asses or estimate.
Tax can be defined in the following ways:
“The compulsory payments made to governments associated with certain activities are called Taxes''
“A general purpose, compulsory contribution by the people to public treasury to meet the expenditure
of government is called Tax ''
“A specific amount of money demanded by government from its public levied on their income, sales,
wealth etc. ''
“Taxes are the price we pay for a civilized society ''
Tax in general, is the imposition of financial charge upon an individual or a company by the
government of India or their respective state or similar other functional equivalents in a state. The
computation and imposition of the varied taxes prevalent in the country are carried on by the Ministry
of Finance Department of Revenue.

2
1.8 Different Types of Taxes:
Fig No. 1

3
1.9 Different Types of Taxes in India:
Prevalence of various kinds of taxes is found in India. Taxes in India can be either direct or indirect.
However, the types of taxes even depend on whether a particular tax is being levied by the central or
the state government or any other municipalities. Following are some of the major Indian government
are:
1. Direct Taxes:
It is names so because it is directly paid to the union government of India. As per a survey, the Republic
of India has witnessed a consistent rise in the collection of such taxes over a period of past years. The
visible growth in these tax collections as well as the rates of taxes reflects a healthy tax along with
better administration of taxation. To name a few of the direct taxes, which are imposed by the Indian
government are:
1. Banking cash Transaction Tax.
2. Corporate Tax.
3. Capital Gains Tax.
4. Double Tax Avoidance treaty.

5. Fringe Benefit Tax.

6. Securities Transaction Tax.
7. Personal Income-tax.
8. Tax Incentives.

2. Indirect Taxes:
As opposed to the direct taxes, such a tax in the nation is generally levied on some specified services
or some particular goods. An indirect tax is not levied on any particular organization or an individual.
Almost all the activities, which fall within the periphery of the indirect taxation, are included in the
range starting from manufacturing goods and delivery of services to those that are meant for
consumption.
Usually, the indirect taxation in the Indian Republic is a complex procedure that involves laws and
regulations, which are interconnected to each other. These taxation regulations even include some laws
that are specific to some of the states of the country. The organizations offer services in all or most of
the related fields, some of which are as follows:
1. Anti-Dumping Duty
2. Custom Duty
3. Excise Duty
4. Sales Tax

4
 5. Value Added Tax or VAT

(3) Local Taxes in India:

The most known tax, which is levied by the local municipal jurisdictions on the entry of goods, is
known as the Entry Tax or the Doctor Tax.
(4) Income Tax
Income tax in India includes all income except the agricultural income that is levied and collected by
the central government. This particular income is also shared with the states. The income tax was
incorporated in India from the year 1860.
However, after many alteration, finally with the Indian Income-tax Act, 1922, there was a
revolutionary change brought by the All India Income Tax Committee. The significant as after this the
administration of the Income Tax came under the direct control of the central Government. This act
got amended again in the year 1961, and the present Income Tax regime in India is still following the
provisions of the act of 1961.
5) Consumption Tax:
Consumption Tax is applicable on the consumption of any type of goods or service. This particular tax
is based on consumption and not on income. The consumption Tax can be regarded as a sales tax, as
this tax is also regressive in nature like the other pure sales taxes. However, there are some remedies
by which the consumption tax can be made progressive in nature.
1.10 GST (India)
Meaning of Goods and Service Tax (GST)
Clauses 366 (12A) of the constitution Bill defines GST as “goods and service tax” means any tax on
supply of goods, or services or both except taxes on the supply of the liquor for human consumption.
Further the clause 366 (26A) of the Bill defines Services means anything other than Goods.
Thus it can be said that GST is a comprehensive tax levy on manufacture, sale and consumption of
goods and services at a national level. The proposed tax will be levied on all transactions involving
supply of goods and services, except those which are kept out of its preview.
Purpose of GST:
The Two Important Purposes of GST are followings:
Single Umbrella Tax Rate: GST shall replace a number of indirect taxes being levied by union and
state government.
Removing Cascading Effect: GST is intended to remove Tax on Tax Effect and provides to common
national market for Goods and Services.

5
Types of Categories under GST rate
The GST tax is levied based on Revenue Neutral Rate. For the purpose of imposing GST tax in India,
the goods and services are categorized in to four. These are four categories of goods and services are
follows:
Exempted Categories under GST in India: The GST and council and other GST authorities notifies
list of exempted goods. Such goods are not fallen under payment of GST tax. The authorities may
modify or amend the list time to time by adding deleting any item if required by notification to public.
Essential Goods and Services for GST in India: Essential Category of goods and services are
charged very lower GST rate. Essential goods and services are the goods and services for necessary
items under basic importance.
Standard Goods and services for GST in India: A major share of GST tax payers falls under this
category of Standard Goods and Service. A Standard rate is charged against the goods and services
under this category.
Special Goods and Services for GST tax Levy: Under special category of goods and services, GST
rates would be high. Precious metals including luxury items of goods and services fall under special
goods and services for GST rate implementations.
GST rates in India at a glance:
Exempted categories: 0
Commonly used Goods and Services: 5%
Standard Goods and Services fall under 1st Slab: 12%
Standard Goods and Services fall under 2nd Slab: 18%
Special category of Goods and Services including Luxury Goods: 28%
What are the taxes that got replaced by GST?
Unlike earlier when there were multiple taxes such as Central Excise, Service Tax and State VAT etc.,
under GST, there is just one tax. GST is categorized into CGST, SGST or IGST depending on whether
the transaction is Intra-State or Inter-State.

6
Fig No. 2

What is Central Goods and Services Tax (CGST)?

Under GST, CGST is a tax levied on Intra State supplies of both goods and services by the Central
Government and will be governed by the CGST Act. SGST will also be levied on the same Intra State
supply but will be governed by the State Government.

This implies that both the Central and the State governments will agree on combining their levies with
an appropriate proportion for revenue sharing between them. However, it is clearly mentioned in
Section 8 of the GST Act that the taxes be levied on all Intra-State supplies of goods and/or services
but the rate of tax shall not be exceeding 14%, each.

Central Taxes which will be subsumed in CGST:

Central Excise Duty.

Additional Excise Duty.

Service Tax.

The Excise duty levied under the medical and toilet preparation Act.

Additional Customs Duty.

Education Less.

Surcharges

7
 What is State Goods and Services Tax (SGST)?

Under GST, SGST is a tax levied on Intra State supplies of both goods and services by the State
Government and will be governed by the SGST Act. As explained above, CGST will also be levied
on the same Intra State supply but will be governed by the Central Government.

State taxes which will be subsumed in SGST:

VAT/ Sales Tax.

Luxury Tax.

Entertainment Tax (unless it is levied by local bodies)

Taxes on Lottery, betting, and gambling.

An example for CGST and SGST:

Let’s suppose Rajesh is a dealer in Maharashtra who sold goods to Anand in Maharashtra worth Rs.
10,000. The GST rate is 18% comprising of CGST rate of 9% and SGST rate of 9%. In such case, the
dealer collects Rs. 1800 of which Rs. 900 will go to the Central Government and Rs. 900 will go to
the Maharashtra Government.

Fig No. 3

8
What is Integrated Goods and Services Tax (IGST)?

Under GST, IGST is a tax levied on all Inter-State supplies of goods and/or services and will be
governed by the IGST Act. IGST will be applicable on any supply of goods and/or services in both
cases of import into India and export from India. This IGST will go to the Centre

• Exports would be zero-rated.

• Tax will be shared between the Central and State Government.

An example for IGST:

Consider that a businessman Rajesh from Maharashtra had sold goods to Anand from Gujarat worth
Rs. 1, 00,000. The GST rate is 18% comprised of 18% IGST. In such case, the dealer has to charge
Rs. 18,000 as IGST. This IGST will go to the Centre.

Fig No. 4

9
Taxes under GST
Fig No. 5

1.11 Introduction to Financial Services Sector

Fig No. 6

India has a diversified financial sector undergoing rapid expansion, both in terms of strong growth of
existing financial services firms and new entities entering the market. The sector comprises
commercial banks, insurance companies, non-banking financial companies, co-operatives, pension
funds, mutual funds and other smaller financial entities. The banking regulator has allowed new
entities such as payments banks to be created recently thereby adding to the types of entities operating
10
in the sector. However, the financial sector in India is predominantly a banking sector with commercial
banks accounting for more than 64 per cent of the total assets held by the financial system.
The Government of India has introduced several reforms to liberalise, regulate and enhance this
industry. The Government and Reserve Bank of India (RBI) have taken various measures to facilitate
easy access to finance for Micro, Small and Medium Enterprises (MSMEs). These measures include
launching Credit Guarantee Fund Scheme for Micro and Small Enterprises, issuing guideline to banks
regarding collateral requirements and setting up a Micro Units Development and Refinance Agency
(MUDRA). With a combined push by both government and private sector, India is undoubtedly one
of the world's most vibrant capital markets. In 2017,a new portal named 'Udyami Mitra' has been
launched by the Small Industries Development Bank of India (SIDBI) with the aim of improving credit
availability to Micro, Small and Medium Enterprises' (MSMEs) in the country. India has scored a
perfect 10 in protecting shareholders' rights on the back of reforms implemented by Securities and
Exchange Board of India (SEBI).
Market Size
The Mutual Fund (MF) industry in India has seen rapid growth in Assets under Management (AUM).
Total AUM of the industry stood at Rs 23.16 trillion (US$ 321.00 billion) as of February 2019. At the
same time the number of Mutual fund (MF) equity portfolios reached a high of 74.6 million as of June
2018.
Another crucial component of India’s financial industry is the insurance industry. The insurance
industry has been expanding at a fast pace. The total first year premium of life insurance companies
reached Rs 159,004 crore (US$ 22.04 billion) as of Jan 2019.
Along with the secondary market, the market for Initial Public Offers (IPOs) has also witnessed rapid
expansion. The total amount of Initial Public Offerings (IPO) stood at Rs 14,032 crore (US$ 1.94
billion) as of Feb 2019.
Furthermore, India’s leading bourse Bombay Stock Exchange (BSE) will set up a joint venture with
Ebix Inc to build a robust insurance distribution network in the country through a new distribution
exchange platform.
Investments/Developments

• Investments by Foreign Portfolio Investors (FPIs) in Indian capital markets have reached Rs
5,400 crore (US$ 748.44 million) up to December 30, 2018.
• As of October 2018, the Financial Inclusion Lab has selected 11 fintech innovators with an
investment of US$ 9.5 million promoted by the IIM-Ahmedabad's Bharat Inclusion Initiative

11
 (BII) along with JP Morgan, Michael and Susan Dell Foundation, and the Bill and Melinda
Gates Foundation.
• The private equity and venture capital (PE/VC) investments reached US$ 33.1 billion in 2018.

Government Initiatives

• In December, 2018, Securities and Exchange Board of India (SEBI) proposed direct overseas
listing of Indian companies and other regulatory changes. It has provided companies with a
broader investor base, better valuation, increased awareness, analyst coverage and visibility.
• Bombay Stock Exchange (BSE) introduced weekly futures and options contracts on Sensex 50
index from October 26, 2018.
• In September 2018, SEBI asked for recommendations to strengthen rules which will enhance
the overall governance standards for issuers, intermediaries or infrastructure providers in the
financial market.
• The Government of India launched India Post Payments Bank (IPPB), to provide every district
with one branch which will help increase rural penetration. As of August 2018, two branches
out of 650 branches are already operational.

Road Ahead

• India is today one of the most vibrant global economies, on the back of robust banking and
insurance sectors. The relaxation of foreign investment rules has received a positive response
from the insurance sector, with many companies announcing plans to increase their stakes in
joint ventures with Indian companies. Over the coming quarters there could be a series of joint
venture deals between global insurance giants and local players.
• The Association of Mutual Funds in India (AMFI) is targeting nearly five fold growth in assets
under management (AUM) to Rs 95 lakh crore (US$ 1.47 trillion) and a more than three times
growth in investor accounts to 130 million by 2025.
• India's mobile wallet industry is estimated to grow at a Compound Annual Growth Rate
(CAGR) of 150 per cent to reach US$ 4.4 billion by 2022 while mobile wallet transactions to
touch Rs 32 trillion (USD $ 492.6 billion) by 2022.

12
1.12 Loans and Advances

The term ‘loan’ refers to the amount borrowed by one person from another. The amount is in the nature
of loan and refers to the sum paid to the borrower. Thus, from the view point of borrower, it is
‘borrowing’ and from the view point of bank, it is ‘lending’. Loan may be regarded as ‘credit’ granted
where the money is disbursed and its recovery is made on a later date. It is a debit for a borrower.
While granting loans, credit is given for a definite purpose and for a predetermined period. Interest is
charged on the loan at agreed rate and intervals of payment. ‘Advance’ on the other hand, is a ‘credit
facility’ granted by bank. Banks grant advances largely for short-term purpose, such as purchase of
goods traded in and meeting other short-term trading liabilities. There is a sense of debt in loan, where
as an advance is a facility being availed of by the borrower. However, like loans, advances are also
too repaid. Thus a credit facility repayable in instalments over a period is termed as loan while a credit
facility repayable within one year may be known as advances.

Loans and advances granted by commercial banks are highly beneficial to individuals, firms,
companies and industrial concerns. The growth and diversification of business activities are effected
to a large extent through bank financing. Loans and advances granted by banks help in meeting short-
term and long term financial needs of business enterprises. We can discuss the role played by banks
in the business world by way of loans and advances as follows:-

(a) Loans and advances can be arranged from banks in keeping with the flexibility in business
operations. Traders may borrow money for day to day financial needs availing of the facility of cash
credit, bank overdraft and discounting of bills. The amount raised as loan may be repaid within a short
period to suit the convenience of the borrower. Thus business may be run efficiently with borrowed
funds from banks for financing its working capital requirements.

(b) Loans and advances are utilized for making payment of current liabilities, wage and salaries of
employees, and also the tax liability of business.

(c) Loans and advances from banks are found to be ‘economical’ for traders and businessmen, because
bank charge a reasonable rate of interest on such loans/advances. For loans from money lenders, the
rate of interest charged is very high. The interest charged by commercial banks is regulated by the
Reserve Bank of India.

(d) Banks generally do not interfere with the use, management and control of the borrowed money.
But it takes care to ensure that the money lent is used only for business purpose.

13
(e) Bank loans and advances are found to be convenient as far as its repayment is concerned. This
facilities planning for future and timely repayment of loans. Otherwise business activities would have
come to halt.

(f) Loans and advances by banks generally carry element of secrecy with it. Banks are duty-bound to
maintain secrecy of their transactions with the customers. This enhances people’s faith in the banking
system.

Lending of Money

The commercial bank lends money in four different ways:

(a) Direct Loans.

(b) Cash Credit.

(c) Overdraft.

(d) Discounting of bills.

Loans

Loan is the amount borrowed from bank. The nature of borrowing is that the money is disbursed and
recovery is made in instalments. While lending money by way of loan, credit is given for a definite
purpose and for a pre-determined period. Depending upon the purpose and period of loan, each bank
has its own procedure for granting loan. However the bank is a liberty to grant the loan requested or
refuse it depending upon its own cash position and lending policy. There are two types of available
from banks:

(1) Demand loan, and

(2) Term loan.

(1) A Demand Loan: - it is a loan which is repayable on demand by the bank. In other words, it is
repayable at short-notice. The entire amount of demand loan is disbursed at one time and the borrower
has to pay interest on it. The borrower can repay the loan either in lump sum (one time) or as agreed
with the bank. Demanded loans are raised normally for working capital purpose, like purchase of raw
materials, making payment of short-term liabilities.

(2) Term loans: -medium and long term loans are called term loans. Term loans are granted for more
than a year and repayment6 of such loans is spread over a longer period. The repayment is generally
made in suitable instalment of a fixed amount. Term loan is required for a purpose of starting a new

14
business activity, renovation, and modernization, expansion/extension of existing units, purchase of
plant and machinery, purchase a land for setting up a factory, construction of a factory building or
purchase of immovable assets. These loans are generally secured against the mortgage of land, plant
and machinery, building and etc.

Cash Credit

Cash Credit is a flexible system of lending under which the borrower has the option to withdraw the
funds as and when required and to the extent of his needs. Under this arrangement the banker specifies
a limit of loan for the customer (known as cash credit limit) up to which the customer is allowed to
draw. The cash credit limit is based on the borrower’s need and as agreed with the bank. Against the
limit of cash credit, the borrower is permitted to withdraw as and when he needs money subject to the
limit sanctioned.

It is normally sanctioned for a period of one year and secured by the security of some tangible assets
or personal guarantee. If the account is running satisfactorily, the limit of cash credit may be renewed
by the bank at the end of the year. The interest is calculated and charged to the customer’s account.
Cash credit, is one of the types of bank lending against the security by way of pledge or /hypothecation
of goods. ‘Pledge’ means bailment of goods as security for the payment of debt.

Its primary proposes is to put the goods pledged in the procession of lender. It ensures recovery of
loans in case of failure of borrower to repay the borrowed account. In ‘hypothecation’, goods remain
in the possession of the borrower, who binds himself under the agreement to give possession of goods
to the banker whenever the banker requires him to do so. So hypothecation is a device to create a
charge over the asset under circumstances in which transfer of possession is either inconvenient or
impracticable.

Overdraft

Over draft facility is more or less similar to ‘cash credit’ facility is the result of an agreement with the
bank by which a current account holder is allowed to draw over and above the credit balance in his/her
account. It is a short-period facility. This facility is made available to current account holder who
operates their account through cheques. The customer is permitted to with the amount of overdraft
allowed as and when he/she needs it and to repay it through deposit in the account as and when it is
convenient to him/her. Overdraft is generally granted by a bank of the basis of a written request by the
customer. Sometimes the bank also insists on either a promissory note from the borrower or personal
security of borrower to ensure safety of amount withdrawn by the customer. The interest rate on

15
overdraft is higher than is charged on loan. The following are some of the benefits of cash credit and
over draft:-

(1) Cash credit and some overdraft allow flexibility of borrowing, which depends upon the needs of
the borrower.

(2) There is no necessity of providing security and documentation again and again for borrowing funds.
(3) This mode of borrowing is simple and elastic and meets the short term financial needs of the
business.

Discounting of Bills

Apart from sanctioning loans and advances, discounting of bills of exchange by bank is another way
of making funds available to the customers. Bills of exchange are negotiable instruments which
enables debtors to discharge their obligations to the creditors. Such bills of exchange arise out of
commercial transactions both in inland trade and foreign trade. When the seller of goods has to release
his dues from the buyer at a distant place immediately or after the lapse of agreed period of time, the
bill of exchange facilitates this task with the help of banking institution. Banks invest a good
percentage of their funds in discounting bills of exchange. These bills may be payable on demand or
after a stated period.

In discounting a bill, the bank pays the amount to the customer in advance, i.e. before the due date.
For this purpose, bank charges discount on the bill at a specified rate. The bill so discounted is retained
by the bank till its due date and is presented to drawee on the date of maturity. In case the bill is
dishonoured on due date the amount due on bill together with interest and other charges is debited by
the bank to the customer’s account.

Nature and security of loans

To ensure the safety of funds lent, the first and most important factor considered by a bank is the
capacity of borrowers to repay the amount of loan; the bank therefore, relies primarily on the character,
capacity and financial soundness of the borrower. But the bank can hardly afford to take any risk in
this regard and hence it also has the security of tangible asset owned by the borrower. In case the
borrower fails to repay the loan, the bank can recover the amount by attacking the assets. It can sell
the assets offered as a security and realize the amount. Thus from the view point of security of loans,
we can divide the loans into two categories: (a) secured, and (b) unsecured.

Unsecured loans are those loans which are not covered by the security of tangible assets. Such loans
are granted to firms/institutions against the personal security of the owner, manager or director. On the

16
other hand, Secured loans are those which are granted against the security of tangible assets, like stock
in trade and immovable property. Thus, while granting loan against the security of some assets, a
charge is created over the assets of the borrower in favour of bank. This enables the bank to recover
the dues from the customer out of sale proceeds of the assets in case the borrower fails to repay the
loan. There are various types of securities which may be offered against loans granted, but all of those
are not acceptable to the banks. The types of securities generally accepted by the bank are the
following:

• Tangible assets such as plant and machinery, motor-van, etc.

• Documents of title to goods, like Railway Receipt (R/R), Bills of exchange, etc.

• Financial securities (Shares and Debentures)

• Life-Insurance Policy.

• Real Estates (Land, Building, etc.).

• Fixed Deposit Receipt (FDR) and Gold ornaments and jewelleries.

1.13 Impact of GST on Financial Services Sector in India

The introduction of GST in India is a substantial shift from the current tax regime. It is expected that
service sectors will have a major impact on GST than the manufacturing or trading sector. Among the
services provided by Banks and NBFCs, financial services such as fund based, fee-based and insurance
services will see major shifts from the current scenario.

What is really implied by financial services?

The term ‘financial services’ has not been specifically defined by the GST law. However, to
understand the implications of this tax on the financial services sector, we need to consider the supply
of goods and services that involve the extension of credit support. These services include but are not
limited to:

–Loans
–Lease
–Hire purchase
–Conditional sales
–Securitisation or assignment of receivables
– Acquisition or sale of shares and securities

17
The compliance towards GST can take some effort in the above fields because of the nature of
operations conducted by banks and NBFCs concerning credit products, lease transactions, hire
purchase, actionable claims and other funds and non-funds-based services.

The GST rate on banking services and services provided by the NBFCs has been raised from 15% to
18% with the execution of this reform from July 01, 2017 onwards. The GST impact on financial
services may further be classified into the following sub-sections:

1. Network of branches to be registered separately

Before the implementation of GST, a bank or NBFC with operations spread across India could
discharge its compliance on service tax through one ‘centralised’ registration. After GST regulation,
these institutions will be required to get a separate tax registration for each of the states they work in.

As a destination-based tax, GST has a multi-stage collection system. In such a mechanism, the tax is
collected at each stage and the credit of tax that was paid at the last stage is available as a set off at the
subsequent stage of the transaction. This transfers the tax incidence to different entities more evenly,
and helps the industry through improved cash flows and better working capital management.

2. Leveraged and de-leveraged Input Tax Credit

Earlier, banks and NBFCs had been majorly opting for the reversal of 50% of the Central Value Added
Tax (CENVAT) credit that they avail against the inputs and input services, while the CENVAT credit
on the capital goods was given without any reversal conditions. Under GST, the 50% of the CENVAT
credit that was availed for inputs, input services and capital goods has been reversed. This leaves banks
and NBFCs with a decreased credit of 50% on capital goods, and in turn raises the cost of capital.

3. Evaluation and adjudication

The impact of GST on banking services and NBFCs will also be felt in terms of evaluation procedures.
Service tax was assessed by the particular regulators in the state where a branch is registered. In
addition, every registered branch of the concerned bank or NBFC had to validate its position for the
chargeability in the respective state and provide a reason for utilising the input tax credit in various
states.

The GST assessment will involve more than one assessing authority, and each of them may have a
different judgement for the same underlying issue. Although such contradictions can prolong the
decision-making process for the financial institutions, the adverse effects of evaluation by one
authority can be offset through decisions made by another assessor.

18
Impact of GST on banking sector – General services

Banks in India have been levying service tax on most transactions enabled by their systems. These
include but are not limited to digital fund transfers, issuance of ATM cards and chequebooks, and
ATM withdrawals beyond a specific limit. With GST on financial services, these services will be taxed
at the rate of 18% instead of the 15% service tax rate that was being charged earlier. For example, if
you withdraw money from an ATM other than your bank’s ATM after exceeding the “free transaction
limit”, you are typically charged Rs 20 plus a service tax, which comes to around Rs 23. With the
imposition of GST, this amount will go up to Rs 23.60.

However, deeper analysis reveals that such an increase in cost should not be considered a negative
GST impact on financial services sector. In the long run, banks will be able to transfer the advantage
of input tax credit – enabled under GST – to the customers. Furthermore, services like fixed deposits
(FDs) and other bank account deposits that were outside the circle of service tax will continue to remain
outside the GST ambit.

A major advantage of GST on financial services and other sectors is that it is a transparent tax and has
reduced the number of indirect taxes.

1.14 Impact of GST on Loans and advances

Earlier Service Tax was levied on Loans which has now been replaced by GST which would now be
levied on loans. The rate of Service Tax was 15% whereas the rate of GST is 18%. A lot of people are
of the opinion that the effective cost of having a loan would increase as the rate of GST is 3% higher
than the rate of Service Tax. Several people are of the opinion that their EMI’s would increase as the
rate has been increased by 3%. However, this is not the case as GST is not levied on repayment of loan
or on payment of Interest on Loan.

GST is only levied on the processing charges and any other charges paid to the bank excluding the
principal repayment and interest payment. These other charges include the Loan Processing Fees, Loan
Prepayment Charges and other charges, if any. As a major chunk of the loan repayment comprises of
principal repayment and interest payment, the impact of GST on Loans would be very negligible. The
impact of GST on Home Loans and Personal Loans has been explained below for a much better
understanding of the impact.

19
Mentioned below are the important loans and their GST rates:

(a) Personal Loan– 18%

(b) Home Loans– 18%

(c) Car Loan– 18%

GST Impact on Personal Loan

A standard GST rate will be charged. Processing fee used to be 1%-2% of the loan amount plus service
tax across banks in India. So, if the loan amount is ₹9 lakhs, the processing fee could be ₹9,000-18,000.
Service tax was expected to be ₹1,350-2,700. Adding all that, the processing fee ranges from ₹10,350-
20,700 before GST. But now with GST coming into effect, the processing fee would jump to ₹10,620-
21,240.

Table No. 1

PERSONAL LOAN INTEREST RATES MAY 2019

Bajaj Finserv 10.99% - 16.00%

Fullerton India 14.00% - 33.00%

HDFC Bank 11.25% - 21.50%

ICICI Bank 10.99% - 18.40%

IndusInd Bank 10.99% - 16.00%

Kotak Bank 10.99% - 20.99%

RBL 13.00% - 18.00%

Standard Chartered Bank 11.50% - 18.00%

Tata Capital 10.99% - 18.00%

20
GST Impact on Home Loan

The processing fee levy where 18% rate will be applicable instead of 15% at the present time.
Processing fee, as of now, stands at 0.25%-1% of the loan amount along with applicable service tax.
So, on a loan amount of say ₹25 lakhs, a processing fee of ₹6,250-25,000+S.T. of 937.50-3,750, used
to be levied. The eventual amount after calculation comes as ₹7,187.50-28,750. With GST, the same
processing fee will be converted into ₹7,375-29,500.

As far as prepayment is concerned, the floating rate home loans do not bear any charge.

As far as under-construction property is concerned, a 12% GST rates will be applicable on the sale of
the property that also includes the land value.

GST Council has reduced the GST on affordable housing schemes from 12% to 8% which means if
someone is purchasing an Under Construction property, and is eligible for PMAY, he shall be liable
to pay a concessional GST on the property. Concession granted is 4%. Also, if you are not eligible to
get PMAY subsidy on home loan then you can’t get the concessional GST. You have to pay the
complete 12%.

The developers are required to pay 28% tax on cement and 18% on steel, which they can claim in full
through Input Tax Credit (ITC) while paying the tax on the completed property.

Table No. 2

HOME LOAN INTEREST RATES MAY 2019

State Bank of India/SBI 8.55% - 9.25%

HDFC 8.65% - 9.65%

LIC Housing 8.95% - 9.15%

PNB Housing Finance 9.00% - 13.00%

Piramal Capital & Housing Finance 9.00% - 9.10%

Tata Capital 9.20% - 9.35%

ICICI Bank 9.05% - 9.25%

Bank of Baroda 8.70% - 9.70%

21
 HOME LOAN INTEREST RATES MAY 2019

Axis Bank 8.85% - 9.10%

Citibank 9.00% - 9.85%

Indiabulls Housing Finance Limited 8.80% - 11.05%

Kotak Bank 8.90% - 8.75%

DHFL 9.05% - 9.95%

Reliance Home Finance 8.75% - 14.00%

GST Impact on Dream 4-Wheeler (Car Loan)

The implementation of GST is likely to be a boon for those wanting to bring home luxury cars whose
prices are expected to go down by 2%-6% due to the reduction in the overall tax incidence by about
7%-12%. Mid sedans and mid SUVs, on the other hand, can be dearer by 2%-5%. Small car prices
may go up by 1%-2%.

Talking about the car loans, almost every charge includes service tax. Processing fee can be 1%-2%
of the loan amount, while prepayment charges remain at 2%-6% of the principal outstanding. After
calculating these charges, the service tax of 15% is added. Post-GST, a 18% tax rate will apply on
these charges and others that are levied on a car loan.

22
 Chapter 2. Introduction to GIFT City

2.1 Gujarat International Finance Tec-City (GIFT City) is a 50%: 50% Joint venture between
Government of Gujarat and IL&FS. GIFT City is India's first operational smart city and international
financial services centre in Gandhinagar.

GIFT is an operational smart city developed in the Gandhinagar as a Greenfield development. The
project includes features like a district cooling system, underground utility tunnel, and automated
waste collection. The city is designed for walkability and includes commercial and residential
complexes with social sector developments like School, Club and Hospital.

The project is located on the bank of the Sabarmati River and is around 12 km (7.5 mi) from
Ahmedabad International Airport. GIFT is easily accessible from all directions through 4-6 lane State
and National Highways. A double corridor metro system is planned to connect GIFT City to the Airport
and various parts of Ahmedabad and Gandhinagar.

The idea for GIFT was developed during the Vibrant Gujarat Global Investor Summit 2007 and is
being planned by East China Architectural Design & Research Institute (ECADI), which is responsible
for planning much of modern-day Shanghai, and Fair wood Consultants India. GIFT City’s Master
Plan is for the 359 hectares (886 acres) of land area to have approximately ~110 buildings with
~5,800,000 m2 (62,000,000 sq. ft.) of built-up area, of which around 67% is commercial, 22% is for
residential and 11% is social facilities. Currently ~190,000 m2 (2,000,000 sq. ft.) of commercial space
is operational, and another 280,000 m2 (3,000,000 sq. ft.) is under development. As of now an
investment of Rs 10,500 crore has already been committed for GIFT City. The city has an integrated
development model which has been spread out in three phases. Each phase is designed as integrated
sustainable development, for example the first phase itself includes development of office space,
residential, school, hotel, club etc.

Currently approximately 200 units/companies are operational with more than 9000 employed in the
GIFT City.

2.2 Utilities

Electricity

The 1000MW electricity supply is planned to be 99.999% reliable (about 5.3 minutes of outage per
year). GIFT's power grid will be designed by ABB Group of Switzerland. All the electricity cables
will be underground.

23
Piped gas

Natural gas will be distributed to every house and building via pipes, which is cheaper and safer than
cylinders. Gas supply to the city will be made from the existing gas network of GSPL, the state-owned
company for gas transmission pipelines. Piped natural gas is already in distribution in the nearby cities
of Ahmedabad and Gandhinagar.

District Cooling System (Air conditioning)

India's first city-level District Cooling System is operational at GIFT City. It helps in reduction of
operational cost and also avoids the capital cost of implementing coolers in each building.

Solid waste management

All waste will be automatically sucked through underground pipes at a high speed of 90 km/h
(56 mph), and will be treated through plasma gasification.

Transportation

GIFT aims at providing a transportation network that ensures accessibility, easy and fast mobility and
few accidental road deaths. This would be achieved by:

1. Using a multimodal mix of transport systems (MRTS/LRTS/BRTS, etc.) for both intercity
transport (to Ahmedabad, Airport, and Gandhinagar) and intra-city transport.
2. Using a walk-to-work concept as part of urban planning with a nodal split of 10:90 between
private and public transport.

GIFT City will also have its own metro stations

Indian Railways railway lines pass the city on the east and west sides; the closest stations are
in Dabhoda and Naroda.

Landmarks

• GIFT Diamond Tower

• GIFT Gateway Towers - will be located in the main avenue of the city. It would have elaborate
terrace gardens and a rooftop restaurant. The towers draw inspiration from Buland Darwaza. It
will have a total 680,000 square metres (7,300,000 sq ft) built up space.
• GIFT Crystal Towers - With a total 790,000 square metres (8,500,000 sq ft) built up area,
four Crystal Towers will overlook the Sabarmati River.

24
• GIFT Convention Centre - Inspired by the structure of Salt crystals and Mahatma Gandhi's Dandi
March, the convention centre would have an opera and have a seating capacity of 10,000. The
centre would have total built up area of 600,000 square metres (6,500,000 sq ft) World Trade
Centre, GIFT City.

2.3 Gift City Operations

1. The city has 62 million sq. ft. of alloted land in its master plan. About 2 million of this is currently
operational, and another 3 million is under development. The RFP for its next phase of development
has been initiated.
2. GIFT has attracted about $1.5 billion in investments. About 150 companies have started operations
employing over 8,000 people. The city hopes to employ a million one day.
3. Companies operating include TCS, Oracle, Infibeam, Bank of Baroda, HDFC Bank, NSE, and
Reliance Capital among others.
4. The city focused on building an economic thread first. Residential infrastructure, starting with
affordable housing, will come up next.
5. There are two significant stuff all green field smart cities promise -- ease of doing business and
reduced opex. Why is that? GIFT has its own urban development authority, so all clearances
technically are "single window". Opex could be 20 percent lower because of lower people costs
compared to metros and shared infrastructure such as District Cooling System. That is a centralised
system to supply chilled water to all units in the city. GIFT would also be a bottle-free city to an
extent. Portable drinking water will be available from any tap.
6. Growth trivia. In insurance, the sum insured by businesses operating in GIFT IFSC have crossed
$20 billion. The exchanges have crossed cumulative trading turnover of $10 billion.
2.4 Allotments in Gift City
Buildings
GIFT ONE
It is office building located in Domestic Tariff Area (DTA) consists of 29 floor (122 mtrs). It is
developed by ITUAL and constructed by L&T Ltd. The building consists of 12 high speed elevators
and has next class building elevation & infrastructure. “GIFT ONE” was inaugurated by Hon’ble Chief
Minister-GOG on January 10, 2013 and is operational with leading Public Sector Banks, IT & Finance
Companies occupying space in the Tower.
GIFT TWO
It is office building located in Domestic Tariff Area (DTA) consists of 29 floor (122 mtrs). It is
developed by ITUAL and constructed by Al Nakra Constructions, Dubai (ANC).The building consist

25
of 12 high speed elevators and will have next class building elevation & infrastructure. The building
will be inaugurated shortly.
Social Infrastructure Allotments
HOSPITAL
Sterling Addlife India Limited, a leading Corporate Hospital Chain is alloted 0.25 mn sq.ft. BUA and
is developing a state-of-the-art multispecialty Hospital of 200 beds in GIFT City. Design &
Architectural Specification of the facility are under finalization, construction to commence shortly.
SKILL DEVELOPMENT & TRAINING CENTER
Skill Development & Training Centre planned at GIFT City will provide skilled manpower with
adequate knowledge in the Financial & allied Services. Allotment has been made to Global Insurance
Services (India) Private Limited for development of Skill Development & Training Centre at GIFT
City. The Centre spread across 0.2 mn. Sq. ft. of BUA to be developed at an estimated investment of
Rs.100 crore will be providing training in the areas of Insurance & related activities. Design &
Architectural features are under finalization.
SCHOOL
Narsee Monjee Educational Trust of Mumbai has been allotted 0.1 mn sq. ft. of BUA to develop ICSE
School in GIFT City. School has become operational from June 2015.
Other Infrastructure Allotments
HOTEL & CLUB
Two Hotels (4/5 star) are being planned in GIFT City currently and work for the same is expected to
commence shortly. GIFT will also have India’s first Business Club. Allotment for GIFT International
Centre (Business Club) is made to West India Hospitality Ltd. Construction of the same is in progress.
Other Infrastructure Allotments Office & Residential Allotments
WORLD TRADE CENTRE (WTC)
GIFT City will host Gujarat’s first World Trade Centre (WTC). Allotment is made to WTC Noida
Development Company Ltd. for development of WTC at GIFT City spanning over 1.5 mn Sq.ft of
BUA at an investment of around Rs. 1000 Cr for the development of office buildings and residential
service apartment. The facility with ultra-modern architectural features dedicated to financial & allied
services will promote trade and business under one roof.
STATE BANK OF INDIA: OFFICE BUILDING
In sync with the vision of GIFT City to develop India’s first Global Financial Hub, State Bank of India,
country’s largest Public Sector Bank is setting up their operations at GIFT City. Allotment has been
made to SBI for development of commercial facilities of around 0.2 mn Sq. ft. of BUA at an investment
of around Rs. 150 crore to support their International & Domestic operations from GIFT City.
26
RESIDENTIAL TOWER
Allotment made to two renowned developers Sobha Developer of Bangalore & Sangath Infrastructure
Pvt. Ltd. for development of around 500 Residential apartments spanning over 0.55 mn Sq.ft. of BUA.
The towers will accommodate the residential requirements for people working in GIFT City.
BSE BROKERS' FORUM
Allotment made to BSE Brokers’ Forum for Development Rights of around 0.5 mn Sq.ft. of BUA for
development of an Iconic BSE Tower for its members at GIFT City.
BRIGADE ENTERPRISES LIMITED
Allotment made to one of the renowned developers Brigade Enterprises Limited for development of
Office Building of around 0.26 mn Sq. ft. of BUA in GIFT SEZ Area. They will also develop Hotel
(0.11 mn Sq. ft. of BUA), Retail Mall (0.4 mn Sq. ft. of BUA) and Residential Towers (0.32 mn Sq.
ft. of BUA) in GIFT Non SEZ Area. HIRANANDANI GROUP
Allotment made to renowned developer Hiranandani Group for development of Office Building in
GIFT SEZ Area for 0.25 mn Sq. ft. of BUA.
LIFE INSURANCE CORPORATION OF INDIA (LIC)
In sync with the vision of GIFT City to develop India’s first Global Financial Hub, Life Insurance
Corporation of India (LIC) India’s Largest Insurance Company is setting up their operations at GIFT
City. Allotment has been made to LIC for development of Commercial Building of around 0.2 mn sq.
ft. BUA on April 04, 2015 at an investment of around Rs. 150 crore to support their International &
Domestic operations from GIFT City.
M/S JANAADHAR (INDIA) PRIVATE LIMITED
Letter of Intent issued to M/s Janaadhar (India) Private Limited for development of Affordable
Housing Project of around 0.14 mn sq. ft. of BUA in GIFT City on January 28, 2015.
RELIANCE CAPITAL
In sync with the vision of GIFT City to develop India’s first Global Financial Hub, Anil Ambani led
Reliance Capital Limited (RCL), one of India’s leading private sector financial services company has
been allotted 5 lakh sq ft of space on June 03, 2015. Reliance Capital will develop 3 lakh sq ft of Office
space in the Processing area of GIFT SEZ and 2 lakh sq ft of Residential space in the Non-Processing
area of GIFT SEZ for its employees at an investment of around Rs. 200 crore which would bring an
employment of around 2500 persons.
Allotments in GIFT SEZ-IFSC
• State Bank of India
• Federal Bank

27
 • ICICI Bank
• Corporation Bank
• Yes Bank
• IndusInd Bank
• Ratnakar Bank Ltd
• Punjab National Bank
• IDBI Bank
• Sterling Enterprises
• GIC
• Reliance AIF Management Co. Ltd
• Iship Design LLP
• Accvell Technologies Pvt. Ltd.
2.5 Awards & Recognition
a. GIFT City has been awarded for “Best Implementation of ICT in Urban Development”
by Indian Express Group in 17th Edition of Express Technology Sabha held in
Hyderabad on 12-15th Feb-2015.
b. GIFT City has been awarded with I.C.O.N.I.C. IDC Insights Award 2014 for
Excellence in Innovation in Government Vertical by International Data Corporation
(IDC).
c. GIFT Project is one of the 6 ventures of India that have figured in list of world's most
innovative, impactful infrastructure projects by International Accounting Firm KPMG.
d. GIFT City has won the “e-LETS “Award for its innovative City Control and Command
Centre (C-4 ). GIFT City is the recipient of “Innovative solution for Smart Cities “, an
accolade that recognizes stand-out organizational contributions in driving change
through technology.
e. GIFT City has been conferred as “Smart City of Future” by Cisco Technology Award
2014.
f. Gujarat International Finance Tec-City (GIFT City) was selected as one of the world's
'Strategic Top 100 Infrastructure Projects' in 2014 by CG/LA Infrastructure Inc, a 25
year old US-based firm and in that won the most prestigious award in the category of
'Green/New Infrastructure Project of the Year'.
g. Gujarat International Finance Tec-City Company Limited (GIFTCL) was awarded as
the 'Outstanding Concrete Structure of Ahmedabad-2013' in the category of

28
 'Commercial Building' for GIFT ONE Tower Project at the 'ICI (Ahmedabad)
UltraTech Award'.
h. Gujarat International Finance Tec-City (GIFT City) had got the Certificate of
Achievement in 'Innovation in Utility Transmission & Distribution Infrastrucuture-
2013 presented by 'Bentley Systems, Incorporation'.
i. Gujarat International Finance Tec-City Company Limited (GIFTCL) won the most
prestigious award in the category of 'Best Industrial Development & Expansion' at the
'Infrastructure Investment Awards - 2012' organized by World Finance – A WN Media
Group based in London.

29
 Chapter 3. Literature Review
1. Arya Kumar. “Prospects of GST on Indian Economy-An Econometric Approach” July
(2018), Introduction of GST brought a great relief to consumer, industrial and producers by
giving a wide coverage of indirect tax under than one platform. From the analysis, it is observed
that GST has a positive effect on several firms and sectors. But the introduction of GST requires
a due care by Central and State Government, firms and companies to educate every bottom
level people who are the end users of such goods and services. This can be done by training,
seminars, and workshops.
2. Karthick R et.al (2017) in their research paper “A Study on consumer perception towards
goods and services tax in Kanchipuram district” found that consumers feel that the tax rates
are high for the products of daily use. They further found that consumers feel that method being
followed for GST is highly complicated and periodic evaluation of tax rates is required. Further
they concluded that GST can be successful only when business persons have a right
understanding of how GST has to be charged to the consumers.
3. Gowtham Ramkumar (2017) in his study titled “Impact of GST on consumer spending
ability in Chennai City” concluded that consumers are left with less money after GST, rise in
inflation level and fall in prices of certain goods after GST implementation. He further
concluded that GST rates will have a significant impact on the spending ability of the
consumers and suggested that benefits of input tax credit must be transferred by the companies
to the consumers.
4. Anshu Ahuja (2017) in the research paper titled “Perception of people towards goods and
services tax” found that consumers are satisfied that goods and services tax will reduce the tax
evasion in the country and will increase the transparency in the tax structure. He further
suggested that government should give some relaxation to farmers and small scale business to
avoid the adverse impact of goods and services tax on their income level.
5. Manoj Kumar Agarwal (2017) in his research paper titled “People’s perception towards
GST – An empirical study” found that people feel that GST has increased the legal
compliances and it will increase the tax collection of the government. He further found that
GST has increased the tax burden of businessmen and suggested that efforts should be made
on the part of the government to ensure people have a proper understanding of the goods and
services tax implemented in India.
6. Mr. A Dash. “Positive and Negative impact of GST on Indian Economy” July (2017),
Implementation of GST impacts a nation both ways, positively and negatively. Ignoring
negative aspects, positive aspects can be taken into consideration, in order to improve the
30
 economy of the country. In order to measure the Impact the GST we need to wait for the time
and the Government needs to communicate more and more about the systems. It could be a
good way to reduce the black money and good effort by the Government of India after the
Demonetization of the money in 2016.
7. Vidya Suresh and Bipasha Maity. “Goods and Services Tax (GST): A Paradigm Shift in
Indian Tax System” December, (2016) The overall macroeconomic effect of reduction in
economic distortions due to GST would be to provide an impetus to economic growth. The
NCAER study commissioned by the Thirteenth Finance Commission estimates the impact of
the introduction of a GST which would eliminate all taxes on production and distribution and
rest on final consumption only. It will lead to efficient allocation of factors of production thus
leading to gain in GDP and exports. The switch over to GST will be neutral to vertical and
horizontal integration and thus will encourage industries to be located in states which enjoy a
comparative advantage. Resource rich backward states will also attract natural resources based
industries regardless of the fact that the consumer is located elsewhere. In nutshell, GST would
generate greater employment as it helps to increase labor intensive sectors and thus, along with
growth in GDP, economic welfare will also be enhanced.
8. Mohamad Ali Roshidi, Zuriadah Ismail & Hazianti Abdul Halim. “Awareness and
Perception of Taxpayers towards Goods and Services Tax (GST) Implementation”
November, (2016) The study attempts to find out what level of awareness and perception to
GST taxpayers in Malaysia. This study only consist of 256 civil service servants of the
secondary school teachers in the Kuala kangsar, Perak. Data collected using questionnaire. The
result shows that moderate and majority of respondents give a high negative perception to the
GST. The eventually causes the majority of respondents did not accept implementation of GST
in Malaysia.
9. Sacchidananda Mukherjee. “Present State of Goods and Services Tax (GST) Reform in
India” January, (2015) This paper argues that reform in tax administration is as important as
tax policy for mobilization of revenue, given the present state of diversities in tax
administration across governments, it is expected that tax administration reforms will be taken
up sooner rather than later, to enable tax officials to administer the GST efficiently.
10. Agog Mawuli (May 2014) studied, “Goods and Service Tax-An Appraisal” and found that
GST is not good for low-income countries and does not provide broad based growth to poor
countries. If still these countries want to implement GST then the rate of GST should be less
than 10% for growth.

31
11. (Pinki, Supriya Kamma and Richa Verma July 2014) studied, “Goods and Service Tax
“Panacea for indirect tax system in india” and concluded that the new NDA government in
india is positive towards implementation of GST and it is beneficial for central government,
state government and as well as for consumers in long run if its implementation is backed by
strong it infrastructure.
12. (Agogo Mawuli May 2014) studied, “Goods and Service Tax an Appraisal” and found that
GST is not good that low income countries and does not provide broad based growth to poor
countries. If still countries want to implement GST then the rate of GST should be less than 10
% for growth.
13. Saravanan Venkadasalam. “Implementation of Goods and Service Tax (GST): An
Analysis on ASEAN States using Least Squares Dummy Variable Model (LSDVM)”
December (2014), He stated that seven of the ten ASEAN nations are already implementing
the GST. He also suggested that the household final consumption expenditure and general
government consumption expenditure are positively significantly related to the gross domestic
product as required and support the economic theories. But the effect of the post GST differs
in countries.
14. (Dr. R. Vasanthagopal 2011) , Conducted a study on , “ GST in India : A big leap in the
Indirect Taxation System” and concluded that switching to seamless GST from current
complicated indirect tax system in India will be positive step in becoming Indian economy.
Success of GST will lead to its acceptance by more than 130 countries in world.
15. Ehtisham Ahmed and Satya Poddar. “Goods and service tax reforms and
intergovernmental consideration in India” (2009) GST introduction will provide implies
and transparent tax system with increase in output and productivity of economy in India. But
the benefits of GST are critically dependent on rational design of GST.

32
 Chapter 4: Research Methodology
4.1 Introduction of Research Methodology:
Research is a logical and systematic search for new and useful information on a particular topic.
Research methodology is a systematic way to solve a problem. It is a science of studying how research
is to be carried out. Essentially, the procedures by which researchers go about their work of describing,
explaining and predicting phenomenon are called research methodology.
4.2 Objectives:
1. To analyse customer’s perception towards Goods and Services Tax (GST).
2. To assess customers view regarding GST on loans and advances at GIFT City, Gandhinagar.
3. To find out the perception and their views on new implemented taxation system.

4.3 Research Design

➢ Exploratory Research
The present research is exploratory in nature. Since GST is a new phenomenon in India, there are
hardly any studies in this area. Especially there is a huge gap of empirical and behavior studies on GST
in India. The study tries to find the significance of popular perception regarding GST.
➢ Descriptive Research

The research design that we used in our research is descriptive research design because if the research
is concerned with finding out who, what, where, when or how much, then the study is descriptive. In
our report, we have found out what is the perception of customer’s towards GST with reference to
loans and advances. And then we work upon findings

4.4 Sampling Design

▪ Target population definition

i) Target population: The population for survey is customers of various

banks at GIFT CITY.
ii) Sampling elements: A customer of a bank at GIFT CITY, Gandhinagar.
iii) Sampling unit: A customer of a bank at GIFT CITY, Gandhinagar.
iv) Extent: Gandhinagar city
v) Sampling methods: I used non-probability convenience sampling.
vi) Sampling size: 100 existing customer of banks at GIFT CITY as
respondents.

33
4.5 Statistical tool:

SPSS software and Microsoft Excel for data analysis.

4.6 Data Collection:

Primary Data: It is collected through Questionnaire.

Secondary Data: Information about tax system, GST, Financial Services and Loans and Advances
and their impact comes under secondary data and is collected through various internet sites.

4.7 Data analysis techniques:

Frequency

• Pie Charts

• Bar Charts

One Way Anova

34
 Chapter 5: Data Analysis & Interpretation

Table No. 3
➢ Gender
a) Male (b) Female

Gender
Frequency Percent Valid Cumulative
Percent Percent
Male 62 62.0 62.0 62.0
Valid Female 38 38.0 38.0 100.0
Total 100 100.0 100.0

Fig No. 7
Interpretation:

In this survey 62 are male respondents i.e. 62% and 38 are female i.e. 38%.

35
Table No. 4

➢ Status

(a) Married (b) Unmarried

Status
Frequency Percent Valid Cumulative
Percent Percent
Married 41 41.0 41.0 41.0
Unmarrie
Valid 59 59.0 59.0 100.0
d
Total 100 100.0 100.0

Fig No. 8
Interpretation:
In this survey 41 respondents are married i.e. 41% and 59 are unmarried i.e. 59%.

36
Table No. 5
➢ Age Group
(a) Below 25 (b) 25-40 (c) Above 40

Age Group
Frequency Percent Valid Cumulative
Percent Percent
Below
37 37.0 37.0 37.0
25
Valid 25-40 53 53.0 53.0 90.0
Above40 10 10.0 10.0 100.0
Total 100 100.0 100.0

Fig No. 9
Interpretation:

The above chart shows that frequency of age group 25-40 is 53 that shows most of the respondents are
between ages of 25-40.

37
Table No. 6

➢ Occupation

(a) Student (b) Businessman (c) Serviceman (d) Professional (e) Housewife
(f) Retired

Occupation
Frequency Percent Valid Cumulative
Percent Percent
Student 18 18.0 18.0 18.0
Businessman 9 9.0 9.0 27.0
Valid Serviceman 43 43.0 43.0 70.0
Professional 30 30.0 30.0 100.0
Total 100 100.0 100.0

Fig No. 10
Interpretation:

The above chart shows that the frequency of Serviceman is 43 that shows that most of the respondents
are serviceman. Frequency of Professionals is 30, frequency of Students is 18 and frequency of
Businessman is 9 which is the lowest frequency.

38
Table No. 7

➢ Qualification

(a) Schooling (b) Graduation (c) Post Graduation (d) Other

Qualification
Frequency Percent Valid Cumulative
Percent Percent
Schooling 11 11.0 11.0 11.0
Graduation 32 32.0 32.0 43.0
Post-
Valid 47 47.0 47.0 90.0
Graduation
Other 10 10.0 10.0 100.0
Total 100 100.0 100.0

Fig No. 11
Interpretation:

Here, most of the respondents are Post-Graduate and their frequency is 47. Frequency of Graduates
is 32, frequency of respondents with only schooling as their qualification is 11 and frequency of
respondents with some other qualification is 10.

39
Table No. 8

➢ Bank for regular transactions

(a) Bank of India (b) Syndicate Bank (c) HDFC Bank (d) Other

Which Bank
Frequency Percent Valid Cumulative
Percent Percent
Bank of India 19 19.0 19.0 19.0
Syndicate
16 16.0 16.0 35.0
Bank
Valid
HDFC Bank 21 21.0 21.0 56.0
Other 44 44.0 44.0 100.0
Total 100 100.0 100.0

Fig No. 12
Interpretation:

Frequency of customers of HDFC Bank is 21, Bank of India is 19 and of Syndicate Bank is 16.
Maximum customers choose some other banks for their regular transactions like Bank of Baroda, Axis
Bank, Union Bank, etc.

40
Table No. 9

➢ Aware of products and services provided by bank

(a) Yes (b) No

Awareness of products and services

Frequency Percent Valid Cumulative
Percent Percent
Yes 53 53.0 53.0 53.0
Valid No 47 47.0 47.0 100.0
Total 100 100.0 100.0

Fig No. 13
Interpretation:

The above chart shows that most of the customers of their respective banks are aware of the products
and services provided by their banks and their frequency is 53 and frequency of customers who are
not aware is 47.

41
Table No. 10
➢ Awareness of the advanced products (loan segments) of bank
(a) Yes (b) No

Awareness about loan segments

Frequency Percent Valid Cumulative
Percent Percent
Yes 47 47.0 47.0 47.0
Valid No 53 53.0 53.0 100.0
Total 100 100.0 100.0

Fig No. 14
Interpretation:
The above chart shows that most of the customers are not aware about the advanced products (loan
segments) of their bank and their frequency is 53 and frequency of customers who are aware is 47.

42
Table No. 11
➢ Bank preferred for taking loans
(a) Bank of India (b) Syndicate Bank (c) HDFC Bank (d) Other

Bank for taking loans

Frequency Percent Valid Cumulative
Percent Percent
Bank of India 17 17.0 17.0 17.0
Syndicate
18 18.0 18.0 35.0
Bank
Valid
HDFC Bank 25 25.0 25.0 60.0
Other 40 40.0 40.0 100.0
Total 100 100.0 100.0

Fig No. 15
Interpretation:
Frequency of customers who take loans from Bank of India is 17, frequency of customers who take
loans from Syndicate Bank is 18, frequency of customers who take loans from HDFC Bank is 25 and
most of the customers choose some other banks for taking loans like Bank of Baroda, Axis Bank,
Union Bank, etc.

43
Table No. 12
➢ Loan product
(a) Home Loan (b) Educational Loan (c) Car Loan (d) Personal Loan
(e) Agriculture Loan (f) Other

Loan Product
Frequency Percent Valid Cumulative
Percent Percent
Home Loan 17 17.0 17.0 17.0
Education
13 13.0 13.0 30.0
Loan
Car Loan 18 18.0 18.0 48.0
Valid Personal Loan 21 21.0 21.0 69.0
Agriculture
5 5.0 5.0 74.0
Loan
Other 26 26.0 26.0 100.0
Total 100 100.0 100.0

Fig No. 16
Interpretation:

Frequency of customers who take Personal Loan is 21, frequency of customers who take Car Loan is
18, frequency of customers who take Home Loan is 17, frequency of customers who take Educational
Loan is 13 and maximum customers opt for some other loans and their frequency is 26.

44
Table No. 13
➢ Years for which loan is availed

(a) Less than 1 year (b) 1 to 3 years (c) 3 to 5 years (d) More than 5 years

Years
Frequency Percent Valid Cumulative
Percent Percent
Less than 1 year 30 30.0 30.0 30.0
1 to 3 years 29 29.0 29.0 59.0
3 to 5 years 26 26.0 26.0 85.0
Valid
More than 5
15 15.0 15.0 100.0
years
Total 100 100.0 100.0

Fig No. 17
Interpretation:
From the above chart it is observed that most of the customers take loans for less than 1 year and their
frequency is 30 and slightly closer to this customers take loans for 1 to 3 years and their frequency is
29. Frequency of customers who take loans for 3 to 5 years is 26 and most of the customers avoid
taking loans for more than 5 years and their frequency is 15.

45
Table No.14
➢ Payment of Instalments
(a) Monthly (b) Quarterly (c) Annually

Instalments
Frequency Percent Valid Cumulative
Percent Percent
Monthly 48 48.0 48.0 48.0
Quarterl
44 44.0 44.0 92.0
y
Valid
Annuall
8 8.0 8.0 100.0
y
Total 100 100.0 100.0

Fig No. 18
Interpretation:
From the above chart it is observed that most of the customers prefer to pay instalments monthly and
their frequency is 48. Frequency of customers who wish to pay instalments quarterly is 44 and
frequency of customers who prefer to pay instalments annually is 8.

46
Table No.15
➢ Awareness about application of GST on loans
(a) Yes (b) No (c) Can’t Say

Aware of application of GST

Frequency Percent Valid Cumulative
Percent Percent
Yes 46 46.0 46.0 46.0
No 25 25.0 25.0 71.0
Valid Can’t
29 29.0 29.0 100.0
Say
Total 100 100.0 100.0

Fig No. 19
Interpretation:
From the above chart it is observed that most of the customers are aware about application of GST on
loans and their frequency is 46. Frequency of customers who can’t say is 29 and frequency of
customers who have no idea about application of GST on loans is 25.

47
Table No. 16
➢ Rate of Interest on loans after GST tax reform
(a) Yes (b) No
Rate of interest
Frequency Percent Valid Cumulative
Percent Percent
Yes 67 67.0 67.0 67.0
Valid No 33 33.0 33.0 100.0
Total 100 100.0 100.0

Fig No. 20
Interpretation:
From the above chart it is observed that most of the customers are affected by the rate of interest on
loans after GST tax reform and their frequency is 67 and frequency of customers who are not affected
is 33.

48
Table No. 17
➢ GST is a very good tax reform for India

(a) Strongly Agree (b) Agree (c) Neutral (d) Disagree (e) Strongly Disagree

Good tax reform

Frequency Percent Valid Cumulative
Percent Percent
Strongly Agree 48 48.0 48.0 48.0
Agree 27 27.0 27.0 75.0
Neutral 15 15.0 15.0 90.0
Valid Dis Agree 4 4.0 4.0 94.0
Strongly
6 6.0 6.0 100.0
Disagree
Total 100 100.0 100.0

Fig No. 21
Interpretation:
Most of the respondents strongly agree that GST is a good tax reform for India and their frequency is
48.
49
Table No. 18

➢ GST has increased the various legal formalities

(a) Strongly Agree (b) Agree (c) Neutral (d) Disagree (e) Strongly Disagree

Legal Formalities
Frequency Percent Valid Cumulative
Percent Percent
Strongly Agree 23 23.0 23.0 23.0
Agree 34 34.0 34.0 57.0
Neutral 37 37.0 37.0 94.0
Valid Dis Agree 5 5.0 5.0 99.0
Strongly
1 1.0 1.0 100.0
Disagree
Total 100 100.0 100.0

Fig No. 22
Interpretation:
From the above chart it is observed that there is a Neutral response from most of the respondents
towards increasing legal formalities because of GST and their frequency is 37 and the frequency of
respondents who agree with this statement is 34.

50
Table No. 19
➢ GST has increased the tax burden on common man

(a) Strongly Agree (b) Agree (c) Neutral (d) Disagree (e) Strongly Disagree
Tax Burden
Frequency Percent Valid Cumulative
Percent Percent
Strongly Agree 8 8.0 8.0 8.0
Agree 34 34.0 34.0 42.0
Neutral 42 42.0 42.0 84.0
Valid Dis Agree 10 10.0 10.0 94.0
Strongly
6 6.0 6.0 100.0
Disagree
Total 100 100.0 100.0

Fig No. 23
Interpretation:
From the above chart it is observed that most of the respondents have a Neutral response about GST
increasing the tax burden on common man and their frequency is 42 and frequency of the respondents
who agree with this statement is 34.

51
Table No. 20
➢ Government has imposed GST on people without any preparation

(a) Strongly Agree (b) Agree (c) Neutral (d) Disagree (e) Strongly Disagree

No preparation
Frequency Percent Valid Cumulative
Percent Percent
Strongly Agree 5 5.0 5.0 5.0
Agree 30 30.0 30.0 35.0
Neutral 36 36.0 36.0 71.0
Valid Dis Agree 25 25.0 25.0 96.0
Strongly
4 4.0 4.0 100.0
Disagree
Total 100 100.0 100.0

Fig No. 24
Interpretation:
Most of the customers have a Neutral response about GST being imposed on people without any
preparation and their frequency is 36 and frequency of respondents who agree with this statement is
30.

52
Table No. 21
➢ GST is very difficult to understand

(a) Strongly Agree (b) Agree (c) Neutral (d) Disagree (e) Strongly Disagree

Difficult to understand
Frequency Percent Valid Cumulative
Percent Percent
Strongly Agree 7 7.0 7.0 7.0
Agree 14 14.0 14.0 21.0
Neutral 39 39.0 39.0 60.0
Valid Disagree 30 30.0 30.0 90.0
Strongly
10 10.0 10.0 100.0
Disagree
Total 100 100.0 100.0

Fig No. 25
Interpretation:

From the above chart it is observed that most of the customers have a Neutral response about GST
being difficult to understand and their frequency is 39 and frequency of respondents who disagree with
this statement is 30.

53
Table No. 22
➢ GST is a good method to replace the sales and service tax

(a) Strongly Agree (b) Agree (c) Neutral (d) Disagree (e) Strongly Disagree

replace sales and service tax

Frequency Percent Valid Cumulative
Percent Percent
Strongly Agree 22 22.0 22.0 22.0
Agree 21 21.0 21.0 43.0
Neutral 33 33.0 33.0 76.0
Valid Disagree 16 16.0 16.0 92.0
Strongly
8 8.0 8.0 100.0
Disagree
Total 100 100.0 100.0

Fig No. 26
Interpretation:

Most of the customers have a Neutral response about GST being a good method to replace the sale and
service tax and their frequency is 33 and frequency of respondents who strongly agree with this
statement is 22.

54
Table No. 23
➢ GST has made taking loans costlier

(a) Strongly Agree (b) Agree (c) Neutral (d) Disagree (e) Strongly Disagree

taking loans costlier

Frequency Percent Valid Cumulative
Percent Percent
Strongly Agree 27 27.0 27.0 27.0
Agree 20 20.0 20.0 47.0
Neutral 34 34.0 34.0 81.0
Valid Dis Agree 13 13.0 13.0 94.0
Strongly
6 6.0 6.0 100.0
Disagree
Total 100 100.0 100.0

Fig No. 27
Interpretation:

Most of the customers have a Neutral response about GST making loans costlier and their frequency
is 34 and frequency of respondents who strongly agree with this statement is 27.
55
Table No. 24
➢ GST has increased the rates on Financial Services

(a) Strongly Agree (b) Agree (c) Neutral (d) Disagree (e) Strongly Disagree

Increased rates on financial services

Frequency Percent Valid Cumulative
Percent Percent
Strongly Agree 14 14.0 14.0 14.0
Agree 47 47.0 47.0 61.0
Neutral 22 22.0 22.0 83.0
Valid Dis Agree 6 6.0 6.0 89.0
Strongly
11 11.0 11.0 100.0
Disagree
Total 100 100.0 100.0

Fig No. 28
Interpretation:

From the above chart it is observed that most of the customers agree that GST has increased the rates
on Financial Services and their frequency is 47.
56
Table No. 25
➢ GST implementation has been a mixed bag for the financial sector

(a) Strongly Agree (b) Agree (c) Neutral (d) Disagree (e) Strongly Disagree

Mixed Bag
Frequency Percent Valid Cumulative
Percent Percent
Strongly Agree 22 22.0 22.0 22.0
Agree 26 26.0 26.0 48.0
Neutral 33 33.0 33.0 81.0
Valid Disagree 13 13.0 13.0 94.0
Strongly
6 6.0 6.0 100.0
Disagree
Total 100 100.0 100.0

Fig No. 29
Interpretation:

Most of the customers have a Neutral response about GST being a mixed bag for the financial sector
and their frequency is 33 and the frequency of respondents who agree with this statement is 26.

57
Table No. 26
➢ GST will reduce tax evasion and will give rise to transparency

(a) Strongly Agree (b) Agree (c) Neutral (d) Disagree (e) Strongly Disagree

Reduce tax evasion

Frequency Percent Valid Cumulative
Percent Percent
Strongly Agree 29 29.0 29.0 29.0
Agree 27 27.0 27.0 56.0
Neutral 21 21.0 21.0 77.0
Valid Disagree 13 13.0 13.0 90.0
Strongly
10 10.0 10.0 100.0
Disagree
Total 100 100.0 100.0

Fig No. 30
Interpretation:
Most of the customers strongly agree that GST will reduce tax evasion and will give rise to
transparency and the frequency of these customers is 29.

58
 HYPOTHESIS TESTING

ANOVA

H0: There is no relationship between Gender and GST is difficult to understand.

H1: There is relationship between Gender and GST is difficult to understand.

ANOVA
Table No. 27
Gender
Sum of Df Mean F Sig.
Squares Square
Between
.385 4 .096 .394 .812
Groups
Within Groups 23.175 95 .244
Total 23.560 99

Interpretation

Here, significant value 0.812 is greater than 0.05 so I accept null hypothesis and reject alternative
hypothesis and conclude that there is no relationship between Gender and GST is difficult to
understand.

59
 ANOVA

H0: There is no relationship between Marital Status and Perception about tax burden due to
GST.
H1: There is relationship between Marital Status and Perception about tax burden due to GST.

ANOVA
Table No. 28
Status
Sum of Df Mean F Sig.
Squares Square
Between
1.123 4 .281 1.157 .335
Groups
Within Groups 23.067 95 .243
Total 24.190 99

Interpretation

Here, significant value 0.335 is greater than 0.05 so I accept null hypothesis and reject alternative
hypothesis and conclude that there is no relationship between Marital Status and Perception about tax
burden due to GST.

60
 ANOVA

H0: There is no relationship between Age and Perception about goodness of GST.
H1: There is relationship between Age and Perception about goodness of GST.

ANOVA
Table No. 29
Age Group
Sum of Df Mean F Sig.
Squares Square
Between
6.777 4 1.694 4.887 .001
Groups
Within Groups 32.933 95 .347
Total 39.710 99

Interpretation:

Here, significant value 0.001 is less than 0.05 so I reject null hypothesis and accept alternative
hypothesis and conclude that there is relationship between Age and Perception about goodness of GST.

61
 ANOVA

Ho: There is no relationship between Occupation and Perception about loans gets costlier.
H1: There is relationship between Occupation and Perception about loans gets costlier.

ANOVA
Table No. 30
Occupation
Sum of Df Mean F Sig.
Squares Square
Between
2.367 4 .592 .528 .715
Groups
Within Groups 106.383 95 1.120
Total 108.750 99

Interpretation:
Here, significant value 0.715 is greater than 0.05 so I accept null hypothesis and reject alternative
hypothesis and conclude that there is no relationship between Occupation and Perception about loans
gets costlier.

62
 ANOVA

H0: There is no relationship between Qualification and GST will reduce tax evasion and give rise
to transparency.
H1: There is relationship between Qualification and GST will reduce tax evasion and give rise to
transparency.

ANOVA
Table No. 31
Qualification
Sum of Df Mean F Sig.
Squares Square
Between
4.506 4 1.126 1.722 .151
Groups
Within Groups 62.134 95 .654
Total 66.640 99

Interpretation:
Here, significant value 0.151 is greater than 0.05 so I accept null hypothesis and reject alternative
hypothesis and conclude that there is no relationship between Qualification and GST will reduce tax
evasion and give rise to transparency.

63
 Chapter 6: Findings & Limitations

After Analysis and Interpretation of the data these are the findings that are emerged:

• Most of the respondents i.e. 53% do not know about the loan segments of their banks.
• Most of the respondents i.e. 30% take loans for less than 1 year.
• Most of the respondents pay their loan instalments on a monthly basis.
• Most of the respondent’s perception are very positive towards the GST and they are aware
of GST.
• 48 % respondents are of the opinion that GST is very good tax reform for India and it is
the turning point of the taxation system.
• 37% respondents have a mixed response that GST has increased the various Legal
formalities.
• Majority of the people have perception that they still need more clarity on GST and
opened that they discuss about GST with others.
• Maximum 36% respondents have mixed response about GST being imposed on people
without any preparation.
• Maximum 47% of the respondents agree that GST has increased the rates on Financial
Services.
• Most of the customers perception is that GST is very beneficial in Long Term for
economy of the country and will also reduce tax evasion and give rise to transparency.
• Most of the customers opinion is that GST is fair tax.

ANOVA testing shows:

• There is relationship between Gender and GST is difficult to understand.

• There is relationship between Marital Status and Perception about tax burden due to GST.
• There is no relationship between Age and Perception about goodness of GST.
• There is relationship between Occupation and Perception about loans gets costlier.
• There is relationship between Qualification and GST will reduce tax evasion and give
rise to transparency.

64
 Limitations

After Analysis and Interpretation of the data these are the limitations that have emerged:

• Time Period of the research was very short i.e. only 45 days.
• Sample Size comprises of 100 respondents which is a very small proportion of tax
payers and people who know about GST.
• The research is single Cross-sectional i.e. respondents are enquired only once.
• The data collection was confined to only Gandhinagar and Ahmedabad which is a
small area for research, whole Gujarat is not covered.
• This study explored Perception about GST. The inherent assumption is that perception
is derived from a person’s beliefs and values. A more rigorous research design should
consider Behavioural, Normative and Control Beliefs.

65
 Chapter 7: Conclusion

This study highlighted the overall overview of GST and impact of GST on Financial Services
particularly with reference to loans and advances. Rates of interest has increased on loans because of
increase in processing fees.

The Government should put in more effort to ensure that Consumers have a clear understanding and
develop a positive perception towards GST, leading to its acceptance. Good understanding among
customers is important as it can generate a positive perception towards the taxation policy.

The Government can initiate and promote an extensive publicity program which could help to create
awareness and generate positive perception among customers in understanding the rationale and
importance of GST in India.

66
 Bibliography

1. Abda S., Effects of goods and services tax on Indian economy, International Education and
Research Journal, 3(5), 584-585 (2015)
2. Devi, S. (2016). Goods and services tax in India: A SWOT analysis. International Journal of
Research - Granthaalayah - A Knowledge Repository, 4(12), 188-195.
3. Sehrawat M, Dhanda U (2015) GST In India: A key tax reform. International Journal of
Research-Granthaalayah.
4. Ahmad, Ehtisham, Satya Poddar A.M. Abdel-Rahman, Rick Matthews, and Christophe
Waerzeggers(2008), Indirect Taxes for the Common Market; Report to the GCC Secretariat.
5. Agresti, A., and Finlay, B. (2009). Statistical Methods for Social Sciences. 4th ed. New Jersey:
Pearson Prentice Hall.
6. Ajzen, I. (1988). Attitudes, Personality and Behaviour. Milton Keynes: Open University Press.
7. Cragg, P. B., King, M. R., & Hussin, H. (2002). IT allignment and firm performance in small
manufacturing firms. Journal of strategic information systems, 109-132.
8. Davenport, T. H. (1998). Putting the Enterprise into the Enterprise System, July/August. 121-
130. Harvard Business Review.
9. Empowered Committee of Finance Ministers (2009). First Discussion Paper on Goods and
Services Tax in India, The Empowered Committee of State Finance Ministers, New Delhi
10. Empowered Committee of State Finance Ministers (2008). A Model and Roadmap for Goods
and Services Tax in India, New Delhi.
11. Agogo Mawuli (2014): “Goods and Service Tax- An Appraisal”Paper presented at the PNG
Taxation Research and Review Symposium, Holiday Inn, Port Moresby,29-30.
12. Dr. R. Vasanthagopal (2011), “GST in India: A Big Leap in the Indirect Taxation System”,
International Journal of Trade, Economics and Finance, Vol. 2, No. 2, April 2011.
13. Batten, A., 2010. Foreign Aid and the Fiscal Behaviour of the Government of Papua New
Guinea, National Research Institute. Discussion Paper 114.
14. Duncan, R., 2002. ‘Structural Adjustment Programs: the Roles of the IMF and the World Bank’
15. Batten, A., 2010. Foreign Aid and the Fiscal Behaviour of the Government of Papua New
Guinea, National Research Institute. Discussion Paper 114.
16. Duncan, R., 2002. ‘Structural Adjustment Programs: the Roles of the IMF and the World Bank’
17. Nakhchian, A., Gorji, N., Shayesteh, T., & Sheibany, E., Value Added Tax and Its Relationship
With Management Information Technology. Interdisciplinary Journal of Contemporary
Research in Business, 4(9), 402–410, 2013.

67
 18. Hanadzlah, A. H. (2010). Penangguhan GST bukan atas desakan pembangkang. Keratan
Akhar. Berita Harian.
19. Dani S (2016) A Research Paper on an Impact of Goods and Service Tax (GST) on Indian
Economy. Bus Eco J 7: 264. doi: 10.4172/2151-6219.1000264

Websites:
www.google.com
www.gstindia.com
www.ibef.org/industry/financial-services-india.aspx
www.giftgujarat.in/documents/Project-Update-August-2015.pdf
www.gstindiaexpert.com/Home/AboutGST/GST-and-its-Benefits

68
 A STUDY ON THE CUSTOMER’S PERCEPTION TOWARDS GOODS &
SERVICE TAX (GST) WITH REFERNCE TO LOANS AND ADVANCES AT
GIFT CITY, GANDHINAGAR

QUESTIONNAIRE
Note: - I am a Student of Centre for Management Studies and Research doing my research project on
“Customers Perception towards GST”. Hereby request you to fill up the questionnaire. The
information provided by you will be kept strictly confidential and will be used for academic purpose
only. Thank you so much for your kind assistance.

SECTION A
Please ' Tick ' your choice ----
1. Gender (a) Male (b) Female
2. Status (a) Married (b) Unmarried
3. Age Group:
(a) Below 25
(b) 25 – 40
(c) Above 40

4. Occupation:
(a) Student
(b) Businessman
(c) Serviceman
(d) Professional
(e) Housewife
(f) Retired

5. Qualification:
(a) Schooling
(b) Graduation
(c) Post-Graduation
(d) Any other Qualification

69
 SECTION B
Q1. On which bank do you depend for your regular transactions?
(a) Bank of India [ ] (b) Syndicate Bank [ ]
(c) HDFC Bank [ ] (d) Other Please Specify _______
Q2. Are you aware of the products & services provided by your bank?
(a) Yes [ ] (b) No [ ]

Q3. If yes are you aware of the advanced products (Loan segments) of your bank?
(a) Yes [ ] (b) No [ ]

Q4. Which bank do you prefer for taking loans?

(a) Bank of India [ ] (b) Syndicate Bank [ ]
(c) HDFC Bank [ ] (d) Other Please Specify _______
Q.5 Which loan product do you use?
(a) HOME LOAN [ ] (b) EDUCATIONAL LOAN [ ]
(c) CAR LOAN [ ] (d) PERSONAL LOAN [ ]
(e) AGRICULTURE LOAN [ ] (f) Other _____________
Q.6 For how many years do you avail loan?
(a) Less than 1year [ ] (b) 1 to 3 years [ ]
(c) 3 to 5 years [ ] (d) more than 5 years [ ]
Q.7 How do you prefer to pay your instalments?
(a) Monthly [ ] (b) Quarterly [ ]
(c) Annually [ ]
Q9. Are you aware of application of GST on loans?
(a) Yes [ ] (b) No [ ]
(c) Can’t Say [ ]
Q10. Does the Rate of Interest on loans affect you after GST tax reform?
(a) Yes [ ] (b) No [ ]

70
 SECTION C
Kindly Tick your perception regarding the Goods and Service Tax.
Sr. No. Statements Strongly Agree Neutral Dis Agree Strongly
Agree Dis Agree

1 GST is a very good tax

reforms for India.
2 GST has increased the
various legal
formalities.

3 GST has increased the

tax burden on common
man.

4 Govt has imposed GST

on people without any
preparation.

5 GST is very difficult to

understand.

6 GST is a good method

to replace the sales and
service tax.

7 GST has made taking

loans costlier.

71
 8 GST has increased the
rates on financial
services.

9 GST implementation
has been a mixed bag
for the financial sector.

10 GST will reduce tax

evasion and will give
rise to transparency.

Source: Primary Data Collection.

…....THANK YOU........

72
73
74