GST-What's it.....! What's in store ......!

Overview of GST Levy, its aspects and Taxes to be subsumed

1. GST  A Transaction Tax in relation to goods and services

Movement of goods or provision of services from one person to another person or from one place to another place, (that is, supply) entails Tax (like, Value Added tax or VAT).

2. Destination based levy

GST is expected to be a destination based consumption tax, unlike the present origin based taxation.

Broadly it means that Tax is levied on, payable on consumption of goods and services and borne by consumer. In a chain of supply, intermediaries (business entities) involved would only collect tax, take credit of tax paid on purchases and pass on tax to the next in chain and ultimately to consumer, like VAT.

3. Dual Tax regime

GST will be a Dual Tax (Centre + State) regime. Intrastate supply of goods or services will be subjected to State GST and Central GST.

On interstate supply of goods and services, Integrated Goods and Service Tax (IGST) would be payable (to be levied by Centre).

4. GST Rate Structure and Rates (Likely)

Likely rates of GST are being contemplated and worked out at relevant Committee levels. Initial aim seems to work on RNR (Revenue Neutral Rate) or maximum rate of GST.

GST Rate structure is likely to span out as under:

5. Input Tax Credit

A dealer and/or service provider will be permitted to set-off Central GST ('CGST') payable against available CGST credit and State GST ('SGST') payable against available SGST credit. In case of IGST, a dealer and / or service provider will be permitted to offset IGST, CGST and SGST on purchases against IGST payable against inter-state transactions of goods and services.

6. Taxes proposed to be Subsumed

Central Taxes State Taxes
Central Excise Duty VAT/ Sales Tax
Additional Excise Duties Entertainment Tax (unless it is levied by the local bodies)
Excise Duty levied under the Medicinal and Toiletries Preparation Act Luxury tax
Service Tax Taxes on lottery, betting & gambling
Additional Customs Duty, commonly known as Countervailing Duty (CVD) State cesses and Surcharges in so far as they relate to supply of Goods & Services, and
Special Additional Duty of Customs-4% (SAD) Entry tax not in lieu of Octroi
Surcharges and Cesses on above Taxes  

Exclusions from GST

Alcohol for human consumption

  • Petroleum products (i.e. crude, High speed diesel-HSD, petrol, natural gas & Aviation Turbine Fuel-ATF) - to be brought within GST purview at later date
  • Electricity duty to be brought within GST purview at later date Taxes to continue
    • Basic Custom Duty
    • Stamp duty
    • Vehicle Tax
    • Electricity duty
    • Securities Transaction Tax

We will deal with each of the aspects touching the levy from time to time for better understanding from a business angle.

In that, the order could be: Provisions of aspects touching levy; Business effects of each aspect or collectively; Practical illustrative situations; Impact of levy on Business; Procedures and it's effects and so on.

SALES TAX  |  VAT  |  ENTRY TAX  |  EXCISE  |  ENTERTAINMENT TAX  |  LUXURY TAX  |  INDIRECT TAX  |  SALES TAX  |  VAT  |  ENTRY TAX  |  EXCISE  |  ENTERTAINMENT TAX  |  LUXURY TAX  |  INDIRECT TAX  |  SALES TAX  |  VAT  |  ENTRY TAX  |  EXCISE  |  ENTERTAINMENT TAX  |  LUXURY TAX  |  INDIRECT TAX  |  SALES TAX  |  VAT  |  ENTRY TAX  |  EXCISE  |  ENTERTAINMENT TAX  |  LUXURY TAX  |  INDIRECT TAX  |  SALES TAX  |  VAT  |  ENTRY TAX  |  EXCISE  |  ENTERTAINMENT TAX  |  LUXURY TAX  |  INDIRECT TAX  |  SALES TAX  |  VAT  |  ENTRY TAX  |  EXCISE  |  ENTERTAINMENT TAX  |  LUXURY TAX  |  INDIRECT TAX  |  SALES TAX  |  VAT  |  ENTRY TAX  |  EXCISE  |  ENTERTAINMENT TAX  |  LUXURY TAX  |  INDIRECT TAX  | 

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