GST and Its Impact on the Cost of Living of Salaried Employees

The introduction of the Goods and Services Tax (GST) marked a major reform in India’s indirect tax system by replacing multiple taxes with a unified structure. While GST aimed to simplify taxation and improve transparency, its effect on the cost of living of salaried employees remains a subject of concern. Salaried individuals, with fixed and predictable incomes, are more sensitive to changes in prices of everyday goods and services. This research paper examines the impact of GST on the cost of living of salaried employees using secondary data sources. The study is based on data collected from government reports, Consumer Price Index (CPI) statistics, GST Council publications, and existing research studies. The analysis focuses on key expenditure areas such as food items, transportation, telecom services, housing-related costs, insurance, and other commonly used services. Descriptive and comparative analysis is used to assess price trends before and after the implementation of GST. The findings indicate that while GST has reduced tax cascading and improved billing transparency, it has also increased the prices of several services that salaried employees regularly consume. As a result, household expenditure has risen, particularly in urban areas. The study concludes that GST has had a noticeable impact on the cost of living of salaried employees and highlights the need for periodic review of GST rates on essential services to reduce financial pressure on this income group.