Investigating the Implications of Goods and Services Tax Revenue on Economic Growth: Empirical Insight from Indian Economy

Abstract

The current study aims to investigate the impact of Goods and Services Tax (GST) revenue on the economic growth of the Indian economy. The study has used the Auto Regressive Distributed Lag (ARDL) modeling by collecting the data from August, 2017 to March, 2024. The results depict that GST revenue has a positive impact on the economic growth of the Indian economy in both short and long run. Similarly, the results assert that foreign direct investment and government expenditure also exert a positive impact on the economic growth in India. Conversely, the results affirm that gross fiscal deficit and inflation have adverse impact on the Indian economy. The findings assert that the policymakers should devise policies to curb the inflation and fiscal deficit to attain long run economic growth for the Indian economy. Similarly, proper consideration should be given to boost the GST revenue and FDI inflow in the Indian economy. The findings have major implications for the policymakers, GST council and government to boost the economic growth and GST revenue of the nation.

Keywords

• Goods and Services Tax
• Indian Economy
• Policymakers
• ARDL modeling and Fiscal Deficit