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Stream/Area:
-
Subject:
-
Paper ID:
10.55041/IJSREM.GSTCOS023
Volume:
10 |
7 |
Jul 2026
Pages:
1-9
Publication Frequency:
Monthly (12 issues per year)
License:International Journal of Scientific Research in Engineering and Management follows the Creative Commons Attribution 4.0 (CC BY 4.0) License, allowing free use and distribution with proper attribution.
Research Scholar
DMS, Pondicherry Central University, Puducherry
Associate Professor,
DMS, Puducherry Central University, Pondicherry
The logistics sector plays an important role in helping economic development. It helps in moving goods in an efficient manner within the national as well as international market. Freight forwarders play a key role in logistics management where they look into all the processes related to transporting, warehousing, document handling, customs clearance, and cargo services. The introduction of GST in India in the year 2017 caused significant transformation in the logistics industry by eliminating several indirect taxes, breaking interstate barriers, and improving supply chain operations. In the month of July 2025, the Indian Government came up with GST 2.0. This study sheds light upon the effect that GST 2.0 will have upon the logistics industry, making specific mention of the effect that it will have upon freight forwarding services. This particular study is of an explanatory type and the sources of data have been collected exclusively from secondary sources such as reports of GST council, government notifications, logistics industry reports, academic journals, and articles from the period 2023-2026. As per the results, it can be seen that the adoption of FCM over RCM has been found to reduce the time for tax administration and cash flow management in the freight forwarding firms. Another positive impact can be seen as regards the implementation of mandatory e-invoicing for logistics GSTINs, which has resulted in increased compliance and transparency levels in the logistics sector. Moreover, the study has established that the compression of GST rates in freight transport services has reduced logistics costs. Nonetheless, several issues still persist in this regard. From the study findings, the following conclusions can be made; GST 2.0 has had a positive effect on freight forwarding services by simplifying administrative processes, ensuring tax compliance, and enhancing supply chain effectiveness. It will help India achieve its goal of lowering logistics costs.
KEYWORDS
The logistics sector is a critical contributor to India's economic growth and trade competitiveness. GST 2.0 represents a significant advancement in the country's indirect taxation framework, particularly for freight forwarding and logistics services. The shift from Reverse Charge Mechanism to Forward Charge Mechanism has simplified compliance procedures, improved working capital efficiency, and reduced administrative burdens. Mandatory e-invoicing has enhanced transparency and strengthened tax compliance across logistics operations. The GST 2.0 has given new optimistic opportunities for un employees and also for new start ups like new entrepreneurs. The extension of digital compliance system, freight forwarding activities, warehousing operations, and supply chain management creates new job opportunities for un employees based on their capability, means technical and non technical persons example B.tech and non B.tech graduates. The study demonstrates that GST 2.0 positively impacts freight forwarding activities by lowering logistics costs, improving invoice processing, enhancing supply chain visibility, and encouraging digital transformation. Although challenges related to technology adoption and compliance management remain, the overall impact of GST 2.0 is beneficial for logistics service providers and freight forwarding companies. Therefore, GST 2.0 can be considered a major reform that contributes toward building a more efficient, transparent, and globally competitive logistics ecosystem in India.
1. Dr. Lingam, S., Dr.M.Ravindranath, Dr.Hema Neelam, Dr.K.V.Ravi Kumar (2025), The Impact of Goods and Services Tax (GST) on the logistics industry in India, Journal of Informatics Education and Research, ISSN: 1526-4726, Vol 5 Issue 2 (2025), pp.775-787 2. Tamilarasi, K., & Ranjith Kumar, R. (2026). An Empirical Study on the Impact of GST on Logistics Management in Tirupur. International Journal of Management Research and Review, 16(2), 97–108. 3. Vadavadagi, P. K. (2018), Impact of GST on Logistic Industry, Accent Journal of Economics Ecology & Engineering, 3(5) 4. Dr.Anitha.M.N, "Impact of Goods and Service Tax (GST) on Logistics Sector in India," International Journal of Economics and Management Studies, vol. 3, no. 8, pp. 32-35, 2016. Crossref, https://doi.org/10.14445/23939125/IJEMS-V3I5P112 5. Cargo Insights.co, (2025). GST 2.0 and logistics sector reforms. 6. Emiza Logistics. (2025). Impact of GST 2.0 on warehousing and logistics, www. emizainic.com 7. Freight Traffic Impacts and Logistics Inefficiencies in India: Policy Interventions and Solution Concepts for Sustainable City Logistics, Transportation in Developing Economies (2022) 8:31 https://doi.org/10.1007/s40890-022-00161-8 8. Impact Of Goods And Services Tax (Gst) On Business Operations, Compliance, And Trade Competitiveness: Evidence From Smes In Bangalore, Karnataka, Dr. Vijayakumar, Dr. Genasha B,2026, ISSNO)2320-5407, ISSN(P) 3107-4928 Int. J. Adv. Res. 14(03), March-2026, 1211-1219 9. GST Council. (2025). GST notifications and logistics reforms. 10. Logistics Outlook. (2025). GST 2.0: Driving lower logistics costs.
Publication Date
7/4/2026
Peer Review Type
Double-Blind Peer Review
Review Rounds: 2
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