The Goods and Services Tax (GST) in India has a positive impact on consumption and savings for households. Here are some key points explaining how GST drives consumption and helps households save on monthly bills: 1. Unified tax system: GST replaced multiple indirect taxes, such as VAT, service tax, and excise duty, providing a simplified tax structure. This helps businesses reduce costs, which can eventually lead to lower prices for goods and services. 2. Reduced tax burden: GST eliminated cascading taxes, where multiple taxes are imposed on the same product at different stages. This reduces the overall tax burden on goods and services, making them more affordable for consumers. 3. Increased competition: GST promotes a formalized economy and reduces the black market. This leads to increased competition among businesses, resulting in better quality goods and services at competitive prices. 4. Input tax credits: Under GST, businesses can claim input tax credits for taxes paid on inputs used in the production process. This helps in reducing the overall cost of production and encourages businesses to pass on the benefits to consumers. 5. Lower transportation costs: GST replaced multiple state-level taxes, reducing paperwork and checkpoints during interstate transportation. This streamlined process has reduced transportation costs, ultimately leading to lower prices for consumers. Overall, the implementation of GST has created a more efficient and transparent tax system, resulting in reduced prices and increased purchasing power for households.