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India's New Tax May Unleash a Flood of Litigation

  • As Modi prepares to launch GST, courts ready for challenges
  • Indirect tax appeals have already locked away $23 billion
Bloomberg business news

Here's What You'll Pay After India's Massive Tax Overhaul

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India’s new goods and services tax will spark a flood of litigation on everything from which tax brackets companies fall into to the revenue they generate, some of the country’s top lawyers predict.

The complex nature of India’s GST -- which has four tax brackets ranging from five percent to 28 percent -- is bound to attract thousands of lawsuits in a legal system already grappling with a backlog of more than 24 million cases, lawyers said. Even before the planned July 1 roll out, about 100,000 indirect tax appeals were clogging India’s judicial system at the end of March, 2015, locking away some $23 billion in potential government revenue, according to a government report.