Factors proportional to GDP & GST
 

1-Which factors are directly & inversely proportional to GDP value overall?
2-Which factors are responsible for positive(increasing) & negative (decreasing) value of GDP?
3-Which factors are directly & inversely proportional to GST value overall?
4-Which factors are responsible for increasing & decreasing value of GST?
Please elaborate with examples because i am not an Economist & didn't read economics in my life being a medical sciences student :)
I am waiting for urgent & detailed answers.
Thanks!

@Irum Siddiqui

From your questions, it seems you have little idea about GDP and GST. I will try to explain in simple words to make things easy.

GDP:
It is abbreviation of Gross Domestic Product. This is overall value of whatever has produced in a country in one year.

It is made of four things.
First is what we spend on our consumption (I mean all the population of Pakistan).
Secondly what we invest on our factories, equipments, etc that can produce some thing in future. Like factories can produce new things for us in future.
Thirdly, what our government spend on its various functions.
Fourthly, the difference between the exports (i.e. things we send to other countries) and imports (things we get from other countries).

So our GDP is proportional to all these four things.

GST:

It is abbreviation of General Sales Tax. This tax is levied on things we consume. For example if you buy a pepsi bottle, then you can see their that in the place where price is written includes GST along with factory price. The factory price goes to company, while GST is collected by pepsi company, which government takes after some time. Now GST is 17 percent, so anything on which GST is levied, if its factory price is 100 rupees, then 17 rupees ultimately go to government.

Regarding proportionality, you can see if people consume more things, more GST will go to government. It is also called indirect tax.

[QUOTE=newstudent;613326]@Irum Siddiqui

From your questions, it seems you have little idea about GDP and GST. I will try to explain in simple words to make things easy.

GDP:
It is abbreviation of Gross Domestic Product. This is overall value of whatever has produced in a country in one year.

It is made of four things.
First is what we spend on our consumption (I mean all the population of Pakistan).
Secondly what we invest on our factories, equipments, etc that can produce some thing in future. Like factories can produce new things for us in future.
Thirdly, what our government spend on its various functions.
Fourthly, the difference between the exports (i.e. things we send to other countries) and imports (things we get from other countries).

So our GDP is proportional to all these four things.

GST:

It is abbreviation of General Sales Tax. This tax is levied on things we consume. For example if you buy a pepsi bottle, then you can see their that in the place where price is written includes GST along with factory price. The factory price goes to company, while GST is collected by pepsi company, which government takes after some time. Now GST is 17 percent, so anything on which GST is levied, if its factory price is 100 rupees, then 17 rupees ultimately go to government.

Regarding proportionality, you can see if people consume more things, more GST will go to government. It is also called indirect tax.[/QUOTE]

I'm beholden to you.
So
GDP value will be high when the more we spend on our consumption & vise versa.
GDP value will be high when there will be more invesment in a country & vise versa.
GDPvalue will be high when our exports will be greater than imports (in short when production will be greater) 7 vise versa.
i need example of your third point please!

Can we say that when the GDP value will be high the GST value can be decreased by a Government? (so the inflation rate can be lowered? )
i heared that Direct tax is better to implement than indirect tax is this right or wrong? why?

Third point is that government spends on its various functions, like defence, law and order, communications, infrastructure and so forth. All these spending by government is also part of the GDP. For example, government of Pakistan spends thousand billion rupees on defence is a part of GDP.

Regarding your second question, it is not necessary that GST will be decreased if GDP is higher.

Direct tax is better, because this tax is on income. The more you earn, the more you pay. The indirect tax like GST is on consumption, i.e. the more you consume the more you pay. This is not good.

For example we have a family, who is earning 1 lac rupees per month, while having 3 members. Consider another family who is earning 10 thousand rupees, while having 10 members, it is natural that they will spend more, but their income is meager and government is taking too much in GST from them. This is one of the typical case of Pakistani elite family having less members and poor one with lots of members who pays more to government. This is why indirect taxes are not considered good in terms of welfare.

@Newstudent
 

i am thankful to you.
Now i'm getting this GDP & GST.
Stay Blessed.
Regards!

@newstudent
can you please explain for me that what is meant by ''2.5% of GDP''?
And what does ''fiscal deficit of 8.8% of GDP'' mean?