GST

(Goods and Services Tax)

What is GST in India

GST describe for Good and Services Tax that is an essential regime of India.
It is the biggest indirect tax reform since independence.
It would be levied when a consumer will purchase a good and service.
GST is a single indirect tax that combines many indirect taxes as Service tax,
Central Excise tax, customs tax, VAT tax etc.
The GST Bill will create a single market for more than a dozen state levies.

Indian Economy An overview

Indias economy is the 11th largest economy across the globe and the third largest in terms
of purchasing power parity (PPP)
G-20 major economies and a member of BRICS
Agriculture, services and industry are the most important sector of India an economy.
Contribution of different sectors in March, 2012 was :
Agriculture
19%
Services
59%
Industry
22%

Tax Structure in India

Direct Tax :
e.g.: Income Tax, Corporate Tax, Wealth Tax.

Indirect Tax :
e.g.: Excise duty, custom duty, Service Tax, Octroi Tax, VAT.

VAT(Value Added Tax)

Implemented in April-1/2005

It is substitution to complex Sales Tax

It overcomes a Cascading Effect of Tax

It applied on " Value Added Portion" in sales price

Power to Tax
India has a two tier federated power to collect tax
The Union Government
The State Governments including urban/rural local bodies

Presently goods are responsible to Vat / Excise / Customs duty while taxable
services attract service tax.

Certain transactions subject to dual - Vat and Service tax

Efforts to bring on a single indirect tax GST proposed

GST(Good and Services Tax)

A Common Tax on
Goods

Services

How will GST Bill Work?

GST will work in a very easy process as it is an indirect tax of nation, that
merged several indirect taxes including vat tax, services tax, central Excise
tax, customs tax etc.
It means that removing other indirect taxes the government will gather only
one tax on the sale of all goods and services.

What is the Deadline of GST Panel?

The Present government has fixed the time limit for rolling out the GST Bill on
April 1 2016.
But by some cause, GST bill could miss out its deadline.
Main opposition party, Congress wants to lessen the GST rate by 18 percent
and also wants to remove the additional tax of 1% levy for manufacturing
states.

Structure of GST

The important reform of India will have two parts-the Central GST and the
State.
CGST will be applicable in the case of Inter-State sale of Goods and
Services.
The CGST will cover many taxes including central excise duty, service tax,
CVD, excise duty on M&TP etc. Beside this, SGST will be applicable in a case
of Intra-state sale of goods and services.
Many indirect taxes come under the SGST such as entry tax, entertainment
tax, vat/sales tax and luxury tax etc.

The Advantages of GST

1. It removes various different taxations.
2. It produces India as the only one market.
3. It taxes goods and services at the same rates so several debates are eliminated
on the tax matter.
4. It reduce taxes on manufacturers. Hence it increases their business and makes
them more competitive at across the globe.

The Disadvantages of GST

1. The Tax on services would go up greatly from 14% to 20%
2. Tax on retails Market would be nearly double.
3. Imported goods would be taxed at high rate of around 6%
4. There are some retail items where the Tax rate is only consider 4
percent but with GST it will be costlier like Garments and clothes.

GST Impact on Several Sectors

GST Impact on Gross Domestic Product (GDP) in India

GST Impact on Real Estate Sector in India.
GST Impact on E-commerce Sector in India.
GST Impact on Hotel and Tourism Industry in India.
GST Impact on Electronics Sector in India.
Know More @ What is GST in India