International Journal of

Business & Management Research (IJBMR)

Open Access | Rapid and quality publishing Review Article | Volume 11, Issue 3| Pages 96-99 | e-ISSN: 2347-4696

Impact of GST on Small Scale Sector: A Study with Special

Reference to Footwear Industries
Dr.V. Sudha1*, Dr. C. Hariharasudhan2 and Dr. A. Kungumapriya3
1,3
School of Management, Nehru Arts and Science College, Coimbatore;1 [email protected]
3
[email protected]
2
Assistant Professor, School of Management, Nehru Arts and Science College, Coimbatore; [email protected]

*Correspondence: Dr.V. Sudha; [email protected]

░ ABSTRACT- A comprehensive dual Goods and Services Tax (GST) has replaced the intricate multi-indirect tax structure
as of 1 July 2017. It was India's most significant tax reform ever. The main goal of the GST, as recently summarised, is to get rid of
all the many subsidiary taxes, their effects, and any mild tax issues that are only possible to solve by paying GST. GST is a tax that
is intended to be paid on a continuous stream of goods and contributions. Any person who grants a contract or provides an item or
service is required to pay GST. The study emphasises how GST has affected Indian SSIs. SSIs play a significant role in the Indian
economy, accounting to almost 40% of industrial production, 42% of exports, and 65% of total economic output.

Keywords: GST, SSIs, Impact, Boon, Bane

ARTICLE INFORMATION Ankita Verma and Priyanka Khandelwal (2018) they found
Author(s): Dr.V. Sudha, Dr. C. Hariharasudhan and Dr. A. out that some enterprises found it beneficial but majority faced
Kungumapriya; difficulties in accepting it. Even so, operational efficiencies
Received:20/06/2023; Accepted: 02/10/2023; Published: 20/10/2023; were improved overall. The authors of this article draw the
e-ISSN: 2347-4696; conclusion that this tax structure affects MSME business
Paper Id: IJBMR; 2006-02 regulation in both favorable and unfavorable ways.
Citation: 10.37391/IJBMR.110304304
Webpage-link:
https://ijbmr.forexjournal.co.in/archive/volume-11/ijbmr-110304.html N.Ramalingam (2018) in his paper titled “Towards Goods and
service taxation- issues and concern” structured through three
Publisher’s Note: FOREX Publication stays neutral with regard to parts. The first part contains basic concepts in GST and its
Jurisdictional claims in Published maps and institutional affiliations. evolution, issues involved in its implementation. In second part
he compared the VAT system and GST system. The third part
attempts to map the major areas of concern and level of
░ 1. INTRODUCTION preparedness of the state from the point view of revenue,
India's government began collecting a goods and services tax administration and compliance. Through this paper he tried to
(GST) on July 1st, 2017. The Indian Constitution has undergone resolved major unresolved issues regarding to the
its 111th amendment. India switched from the VAT system to implementation from the state’s perspective. He suggested that
the GST system. A unified tax, known as the goods and services each of the issues should be discussed with stakeholders at all
tax, replaces the several domestic taxes that are now in effect. the levels for the smooth and hassle-free transition to GST.
Unlike the prior origin-based tax scheme, it is a "destination-
based tax" on the production, consumption, and sale of products V. Raveeendra Saradhi and O.P Wali (2018) study stated that
and services across all of India. "One nation, One Tax" is the the impact of GST in the business supply chain system. They
GST's catchphrase. GST is already in use in 160 countries. found that GST helps fast moving of goods from one state to
Malaysia, Canada, France, the United Kingdom, New Zealand, other states through the unified tax system. But the relative
Singapore, and more countries are included in this. GST in India opportunities and risk of procurement from GST registered
is a dual-system country. Central GST (CGST), which the vendors and unregistered vendors are likely to affect sourcing
Indian central government would levy and collect, is one of the decisions.
main components.
M. Jayalaksmi and G.Venkateswarlu(2018) in their study
titled “Impact of GST on Micro, Small and Medium
░ 2. REVIEW OF LITERATUTURE Enterprises” point out that marginally negative impact will be
K.Khasimpeera and Dr.M.Sugantha Reddy (2018) titled for the leather and footwear sectors. They state that GST aims
GST and its impact on Indian economy is found out that the to increase the taxpayer’s base and majority of the SME into its
GST will affect Indian economy in positively and negatively. If scope and will put a burden of compliance and associated cost
the government taking good measure for improving the GST to them. They concluded that even in short run MSMEs will
system, it will give more positive results to the economy. They face somany issues. But in long run I t will be useful for the
also found out that the implementation of GST was a good way companies. This study was conducted at Tirupati, Andra
to reduce black money and good effort of Indian government Pradesh.
after the demonetization of money.

Website: www.ijbmr.forexjournal.co.in Impact of GST on Small Scale Sector: A Study with Special 96
 International Journal of
Business & Management Research (IJBMR)
Open Access | Rapid and quality publishing Review Article | Volume 11, Issue 3| Pages 96-99 | e-ISSN: 2347-4696

Nedunchezhian, et al., (2018) conducted a study on “Analysis many technological changes has occurred in the procedures of
of impact of GST with special reference to perspective small business. The technological change also has an important role
business stakeholders”. In their study they concluded that GST in the business. This study examines the various technological
is a revolutionary development for implementing the growths happened in the small scale sector of footwear
transparency system in the country. They also pointed out that businesses with respect to Goods and service taxes.
the GSTIN network issues and complexities of filing the return
process in new tax system for the businesses. They conclude ░ 4. OBJECTIVES OF THE STUDY
that GST can be a good platform for the tax structure 1) To study the socio- economic background of the
contribution for the economic development of the country. Entrepreneurs in footwear industries
Subhamoy banik (2018) in his article he concluded that small 2) To study the problems and challenges faced by footwear
scale industries are essential for the development of economy. Industries in Calicut district after GST Implementation.
Through boosting SSI sector, the economy can achieve a great 3) To study the awareness of entrepreneurs towards the
contribution for growth. He also suggesting that to educate the importance of GST for the growth of economy.
MSME sector is essential for the utilization of optimum
capability. The government supports like to procure good 4.1 Scope of the Study
quality of raw materials is also essential to support for small This study is conducted to examine the Impact of Goods and
scale businesses. Service Taxes in small scale footwear Industries. The
entrepreneurs were followed Value added tax system till 2017.
Aryan agarwal, Richa Sekhani (2018) in this study they GST means to bring every indirect tax into one unified tax
provide a detailed insights about GST impact of Uttarakhand system. Through sudden changes of tax system made so many
and Kerala. They found that after implementation of GST the challenges in the business for entrepreneurs. This study will
transaction cost of the business decreased by 3.5 times than review the various Impacts of footwear industries in Calicut.
previous tax system. Another finding was the implementation Study is entirely based on the reviews collected from the
of GST is formalization of the informal sector in the economy. entrepreneurs in Calicut city.

Shubham Khaithan (2018) in this report they explained that 4.2 Research Methodology
there will be widespread impact on small scale Industrial Sector The present study is using descriptive design. Descriptive
on GST. They observed that unorganized sectors need to be research study by applying survey method, the data for the study
organized themselves in order to sustain under GST. Through have been collected from the Entrepreneurs of footwear
this report they conclude that, in short run the SSI sector may industries in Calicut region. Instead of obtaining from each and
face some problems. But in long run the sector will get positive every unit of the universe, only a small representation part is
impact through this GST scheme. studied and the conclusion are drawn on that basis for the entire
universe or whole population. For this research probability and
Nabendu Basak (2018) his article said that GST is the biggest simple random sampling was used for collecting the data. By
reforms in history after independence. He found out that GST applying lottery method (without replacement). The sample unit
will fuels inflation in short run but when taking long run the for the study is the Entrepreneurs in the footwear business.
stakeholders will be benefited. He also commented that GST
will transform the business as whole through decreasing the 4.3 Data Analysis
cascading effect of taxation and revenue leakage. He expressed Table 1.1 AGE GROUP OF ENTREPRENEURS AND
his thought that GST will bring easy calculations and SATISFACTION LEVEL OF GST IMPLEMENTATION
implementation. Transparent tax system will make corruption
free economy. Profile of Chi-Square
the value
Sl. No N Mean S.D. d.f
responde
S.Deivamani, et al., (2018) Small scale business cannot easily nt
make transformation with new tax system. Through GST it
became simpler for small scale industries. The reduction of tax
system and uniformity of the states etc made easier. 1.04
Government also doing more awareness about the newly Age 3.39 12
3
Group of
implemented tax system for the smooth running of business. Entrepren
Small scale industries have a sudden transformation problem 1. eurs 11
26.202
within short span of time. But they sure that in long run the 4
small scale business can reduce the negative impact.
Satisfactio
n Level of 2.99 1.01 12
░ 3. STATEMENT OF PROBLEM GST
India is second largest footwear manufacturer after china. The Implemen
2. tation
production in India is considered as 9 percentage of the global
annual production. These 75 percentages of production is
S=Significant @ 5% level (P value <= 0.05); NS = Not
coming from the unorganized sector including small and
Significant @ 5% level (P value > 0.05).
medium enterprises. After Implementation of GST there are so

Website: www.ijbmr.forexjournal.co.in Impact of GST on Small Scale Sector: A Study with Special 97
 International Journal of
Business & Management Research (IJBMR)
Open Access | Rapid and quality publishing Review Article | Volume 11, Issue 3| Pages 96-99 | e-ISSN: 2347-4696

that awareness programs about the opportunities should be

N = Total No of Samples, S.D = Standard deviation, d.f = conducted in each district.
Degree of freedom. Here, Calculated P Value = .010
2. The function of SSI in the state is badly occurred due to
░ 5. CHI-SQUARE TEST inadequate and non- availability of funds in time. Existing
In order to find the association between the Educational industrial firms are suffering due to lack of working capital. The
Qualification of the respondents and Burden of GST, a chi- main barriers towards industrial growth which requires instant
square test was performed and result of the test is shown in table remedy.
4.2.2 3. In order to overcome the problems or difficulties of available
H0: There is no association between the Educational loans from various commercial banks, simplifying the existing
Qualification of the respondents and Burden of GST procedures of granting loans to Small Industries can be treated.
S=Significant @ 5% level (P value <= 0.05); NS = Not Reduction of paper work, providing more authorities to branch
Significant @ 5% level (P value > 0.05). managers and other subordinates etc. are some of the other
N = Total No of Samples, S.D = Standard deviation, def. = valuable measures that can be taken to solve the financial
Degree of freedom problems of SSI units in the state to a great extent.
░ 6. FINDINGS ░ 8. CANCLUSION
1. The table 1.1 shows that the P value is less than 0.05 (i.e.,
0.010) with Age group of the entrepreneurs and From this study, it is clear that the Implementation of goods and
Satisfaction level of GST Implementation. The results are service tax has both positive and negative impacts in small scale
SIGNIFICANT at 5% level. Hence null hypothesis (Ho) is footwear industries in Calicut. It is clear that a sudden
rejected. Thus, it is concluded that there is association transformation can’t make with this GST in the small-scale
between Age groups of the respondents and Satisfaction sectors. To solve the current issues, there is a need of time.
level of GST Implementation. Through the GST the government could make a unified tax
system across the country instead of Value added tax system.
2. The table 1.2 shows that the P value is less than 0.05 (i.e., The impact of Goods and Service Tax implemented in small
0.010) with Age group of the entrepreneurs and scale footwear enterprises in Calicut is yet to be realized as the
Satisfaction level of GST Implementation. The results are progress made is to be estimated. Yet it has the potential to go
SIGNIFICANT at 5% level. Hence null hypothesis (Ho) is a long way in improving the business condition of the state in
rejected. Thus, it is concluded that there is association small and medium enterprise sector.
between Age groups of the respondents and Satisfaction
level of GST Implementation. ░ REFERENCES
[1] Harris, E. A. (1950). A survey of the New Zealand footwear
manufacturing industry with special reference to conditions in the
3. The table 1.3 shows that the P value is less than 0.05 (i.e., industry prior to and during the licensing phase 1939-1949.
0.010) Educational Qualification of the respondents and [2] Revathi, R., & Aithal, P. S. (2019). Review on global implications
Burden of GST. The results are SIGNIFICANT at 5% of goods and service tax and its Indian scenario. Saudi Journal of
level. Hence null hypothesis (Ho) is rejected. Thus, it is Business and Management Studies, 4(4), 337-358.
concluded that there is association between Educational [3] Heuser, V. D., Erdtmann, B., Kvitko, K., Rohr, P., & da Silva, J.
(2007). Evaluation of genetic damage in Brazilian footwear-workers:
Qualification of the respondents and Burden of GST.
biomarkers of exposure, effect, and susceptibility. Toxicology, 232(3),
235-247.
░ 7. SUGGESTIONS [4] Biswas, S., & Bhattacharya, M. (2021). Capital Structure and
Profitability: Footwear Companies in the Indian Context. IUP Journal
Profile of Chi- of Accounting Research & Audit Practices, 20(1).
Sl.No the N Mean S.D d.f Squar [5] Singh, S., Verma, M., & Yadav, R. K. (2023). Impact of organised
respondent e value retail sector on unorganised retail market–with special reference to
Malwa region of Madhya Pradesh, India. World Scientific News, 178,
Educational 2.68 79-100.
1. .897 12 [6] Baliyan, M., & Rathi, P. (2018). Impact of GST on different sectors
Qualification
of Indian economy. International Journal of Innovative Research and
114 26.116 Advanced Studies (IJIRAS), 5(3), 241-243.
[7] Bholane, K. P. (2017). Structure and Impact Assessment of GST in
Burden of 3.23
2. 1.06 12 India. Vidyawarta Research Journal-Special Issue, 275-281.
GST [8] Bari, F., & Cheema, A. (2005). SME development in Pakistan
analyzing the constraints to growth.
[9] LM, M., & Aithal, S. (2019). Review on Global Implications of
The following suggestions may help to improve the GST Goods and Service Tax and its Indian Scenario.
problems in the business. [10] Nebert, D. W., & Vasiliou, V. (2004). Analysis of the glutathione
1. Government should take more initiatives for the growth of S-transferase (GST) gene family. Human genomics, 1(6), 1-5.
women entrepreneurs in the field of small-scale industries. For [11] Hayes, J. D., & Pulford, D. J. (1995). The glut athione S-
transferase supergene family: regulation of GST and the contribution

Website: www.ijbmr.forexjournal.co.in Impact of GST on Small Scale Sector: A Study with Special 98
 International Journal of
Business & Management Research (IJBMR)
Open Access | Rapid and quality publishing Review Article | Volume 11, Issue 3| Pages 96-99 | e-ISSN: 2347-4696

of the lsoenzymes to cancer chemoprotection and drug resistance part

I. Critical reviews in biochemistry and molecular biology, 30(6), 445-
520.
[12] Dani, S. (2016). A research paper on an impact of goods and
service tax (GST) on Indian economy. Business and Economics
Journal, 7(4), 1-2.
[13] Vasanthagopal, R. (2011). GST in India: A big leap in the indirect
taxation system. International Journal of Trade, Economics and
Finance, 2(2), 144.
[14] Pemble, S. E., Wardle, A. F., & Taylor, J. B. (1996). Glutathione
S-transferase class Kappa: characterization by the cloning of rat
mitochondrial GST and identification of a human homologue.
Biochemical Journal, 319(3), 749-754.
[15] Heller, R., & Siegismund, H. R. (2009). Relationship between
three measures of genetic differentiation GST, DEST and G'ST: how
wrong have we been?. Molecular ecology, 18(10), 2080.
[16] Kumar, V. (2016). GST-A boon or a bane for India. International
journal for innovative research in multidisciplinary field, 2(9), 01-05.
[17] Mishra, A. K., Rath, B. N., & Dash, A. K. (2020). Does the Indian
financial market nosedive because of the COVID-19
Outbreak, in comparison to after demonetisation and the GST?.
Emerging Markets Finance and Trade, 56(10), 2162-2180.
[18] Paiva, R. M., Marques, E. A., da Silva, L. F., Antonio, C. A., &
Arán-Ais, F. (2016). Adhesives in the footwear industry. Proceedings
of the Institution of Mechanical Engineers, Part L: Journal of
Materials: Design and Applications, 230(2), 357-374.
[19] Staikos, T., & Rahimifard, S. (2007). A decision-making model
for waste management in the footwear industry. International journal
of production research, 45(18-19), 4403-4422.
[20] Huang, Z., Zhang, X., & Yunwei, Z. H. U. (2008). The role of
clustering in rural industrialization: A case study of the footwear
industry in Wenzhou. China Economic Review, 19(3), 409-420.

© 2023 by the Dr.V. Sudha, Dr. C.

Hariharasudhan and Dr. A. Kungumapriya.
Submitted for possible open access publication
under the terms and conditions of the Creative Commons Attribution
(CC BY) license (http://creativecommons.org/licenses/by/4.0/).

Website: www.ijbmr.forexjournal.co.in Impact of GST on Small Scale Sector: A Study with Special 99