Macro economic impact of GST

The 21st century is running in a fast forward mode. There is no time to sit and relax, as everyone is in pursuit of something. One such field where every moment is so unpredictable and we have to work 24/7 to hold on to our position, is the business world.

The business environment comprises various internal and external forces, under which the organizations operate. Dibb et al (2006) categorizes the business environment into macro and micro factors.

A macro environment is the condition that exists in the economy as a whole, rather than in a particular sector or region. In general, the macro environment includes gross domestic product(GDP), inflation, employment, spending, and monetary and fiscal policy.

The performance of the company also depends on the macro environment in which it is operating. In this case environment does not refer to the geographical location of the company, but to the main sector under which the company is operating. For instance, fashion world is the sector under which our modern clothing industries operate.

In our county, the recent hotline of economics is the introduction of GST, the Goods and Services Tax, which is expected to have significant macro-economic implications in terms of growth, inflation, export competitiveness and fiscal balance, in the years ahead. Macro Environment factors cannot be directly controlled by a company and is the collective result of the functioning of the entire economy. Implementation of GST has caused a major confusion and restlessness in the past two months in many business environments.

Drastic changes may or may not have positive effects on the business environment. Even the economists are not sure of the immediate impact of GST and some even say it may impede growth in the short term, as big companies reorganise their businesses and as small firms lose revenue.

As one the confused citizens of our country, I suggest that all business sectors must be alert and have to plan the ethics properly to overcome this mix-up, because we have no time to ponder upon one issue all the time.