Despite the GST's success in broadening the tax base, issues such as the Inverted Duty Structure, Input Tax Credit disputes, and multiple registrations continue to impair ease of doing business. Critically evaluate and suggest reforms.

Operational since 1 July 2017 under Article 246A, GST completed nine years in 2026. It has demonstrably widened the tax net and revenue base, yet unresolved design frictions still raise compliance costs — its record is substantial but incomplete.

Successes: base-widening and buoyancy

• Formalisation: registered taxpayers rose from about 60 lakh (2017) to over 1.5 crore, deepening the tax base [2].
• Revenue buoyancy: record gross collection of ₹22.08 lakh crore in FY 2024-25 (9.4% YoY) [1]; ₹17.4 lakh crore during April–December 2025 [2].
• Cooperative federalism: the GST Council (Article 279A) gives Centre and States a standing constitutional forum for rate and design decisions [3].
• Input Tax Credit (ITC) ended cascading by allowing set-off across the value chain.

Persisting impairments to ease of doing business

• Inverted Duty Structure: tax on inputs exceeding tax on output causes ITC to accumulate as blocked working capital, hitting textiles, fertilisers and pharma [4].
• ITC disputes: anti-fraud scrutiny of fake invoicing also stalls genuine claims; appellate relief is slow pending full functioning of the GSTAT [4].
• Multiple registrations: one registration per State per entity multiplies filings and audits for multi-State firms [4].
• Narrow coverage: petroleum, electricity and potable alcohol remain outside GST, breaking the credit chain.
• Warning signal: in June 2026 domestic GST grew only 6.5% against ~35% from imports, domestic share falling to 69% — weak domestic value addition alongside high compliance friction [4].

Way forward

• Move to the simplified two-rate "GST 2.0" structure to correct inversions at source [2].
• Risk-based provisional refunds and faster credit release.
• Optional single pan-India registration for multi-State taxpayers; fully staffed GSTAT benches.
• Phased inclusion of petroleum and electricity through Council consensus.

GST's architecture is sound; its remaining costs are procedural, not structural. Rate simplification, faster refunds and unified registration can convert a successful revenue instrument into a genuine "One Nation, One Market" — the very promise the 101st Amendment set out to secure.