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Latest on GST - Explained

Views: 6 | | 2017-Jun-26


GST is one indirect tax for the whole nation, which will make India one unified common market.

GST is a single tax on the supply of goods and services, right from the manufacturer to the consumer. Credits of input taxes paid at each stage will be available in the subsequent stage of value addition, which makes GST essentially a tax only on value addition at each stage. The final consumer will thus bear only the GST charged by the last dealer in the supply chain, with set-off benefits at all the previous stages.

Latest on GST - EasyPaper.cf


BENEFITS OF GST

  • For Business & Industry

  1. Easy compliance
  2. Uniformity of tax rates and structures
  3. Removal of cascading
  4. Improved competitiveness
  5. Gain to manufacturers and exporters


  • Gain to manufacturers and exporters

  1. Easier to Administer
  2. Higher control on leakage
  3. More Revenue efficiency

  • For Final Consumers

  1. Single yet transparent system for the taxes levied on goods and services
  2. Relief on overall tax burden

Following Central level taxes are subsumed into GST:

  1. Central Excise Duty.
  2. Additional Excise Duty.
  3. Service Tax.
  4. Additional Customs Duty / Countervailing Duty.
  5. Special Additional Duty of Customs.

Following State level taxes are subsumed into GST:

  1. Value Added Tax / Sales Tax.
  2. Entertainment Tax (other than the tax imposed by the local bodies), Central Sales Tax (imposed by the Centre but collected by the States).
  3. Octroi and Entry tax.
  4. Purchase Tax.
  5. Luxury tax.
  6. Taxes on lottery / betting / gambling.

There are 3 types of GSTs:

  1. The Central GST (CGST): The tax collected by and levied by the central government.
  2. The State GST (SGST): The tax collected by and levied by the respective state government.
  3. The Integrated GST (IGST): The tax collected by and levied by the central government on inter-state selling and buying.


The CGST and SGST would be levied simultaneously on each and every sale/purchase of goods/services other than the exempted ones.

Following is a diagram to explain the working principle of dual GST system:

Dual GST model - easypaper.cf



The IGST will be levied and collected by the central government on every inter-state supply of goods/services apart from the exempted ones.

Following is the working principle of IGST model of taxing:

IGST working principle - GST - EasyPaper.cf


Following are the products/services that will likely get cheaper:

  1. GST - cheaper products - EasyPaper.cf  Movie tickets of Cinema theater and other tickets to stage performances.
  2. GST - Dining gets cheaper - EasyPaper.cf Dining in restaurants.
  3. GST - 2 Wheeler gets cheaper - EasyPaper.cf TWO Wheeler.
  4. GST - Sedans will get cheaper - EasyPaper.cf Entry - level Sedans (except small cars).
  5. GST - Luxury cars and SUV will get cheaper - EasyPaper.cf SUVs and Luxury / Premium Cars.

Following are the products/services that will likely get expensive:

  1. GST - Mobile bills will get expensive - EasyPaper.cf Mobile Bills.
  2. GST - Life Insurance will get expensive - EasyPaper.cf Life Insurance policies.
  3. GST - Banking and investment will get expensive - EasyPaper.cf GST - Investment services will get expensive - EasyPaper.cfBanking and Investment Services.
  4. GST - DTH will get expensive - EasyPaper.cf DTH services.
  5. GST  - WiFi and Broadband will get expensive - EasyPaper.cf  WiFi and Broadband.
  6. GST - Online transactions will get expensive - EasyPaper.cfOnline transactions and online shopping.
  7. GST - Home rents will get expensive - EasyPaper.cf Residential and Home rentals.
  8. GST - Health care will get expensive - EasyPaper.cf Health Care.
  9. GST - School fees will get expensive - EasyPaper.cf School fees.
  10. GST - Courier service will get expensive - EasyPaper.cf Courier services.
  11.  GST - Railways and metros will get expensive - EasyPaper.cf Commuting by Metro and Railways.
  12. GST - Television (TV) sets will get expensive - EasyPaper.cf Television (TV) sets.
  13. GST - Cooking stoves will get expensive - EasyPaper.cf Cooking Stoves.
  14. GST - Washing Machines will get expensive - EasyPaper.cf Washing Machines.
  15. GST - Aerated drinks will get expensive - EasyPaper.cf      Aerated drinks.

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