Mumbai, July 3: Benchmark Indian indices opened higher on Monday, buoyed by the effect of the new tax regime of Goods and Services Tax (GST). Bombay Stock Exchange’s (BSE) 30-scrip Sensitive Ondex (Sensex) gained as many as 337 points at the opening, while the wider 50-scrip National Stock Exchange or Nifty also opened above the benchmark 9,500 mark, after a week of poor performance.
At 9.30 am on Monday, the Sensex was trading at 31,077 points, up by 156 points. Nifty was trading at 9,549.45 points, up by 28.55 points or 0.30 per cent in early morning session. The BSE Midcap and Small cap also gained 0.3 per cent and 0.4 per cent, respectively. The stocks of ITC gained over 6 per cent in morning trading session. On Monday, Moody’s had also predicted a revenue boost for India, in the aftermath of the implementation of the new unifying tax regime.
An IANS report quoted Moody’s Investors Service Vice-President (Sovereign Risk Group) William Foster as saying in his official statement, “It (GST) will support higher government revenue generation through improved tax compliance and administration. Both will be positive for India’s credit profile, which is constrained by a relatively low revenue base.”
He further said that the new law will bring in better tax compliance, due to three factors- incentivization of tax credits in the new system, ease of compliance through IT infrastructure, and an overall reduction in the cost of compliance because simplified and uniform rates across the country. “We expect the net impact of GST on government revenues to be positive”, Foster added in his statement.