HIGHLIGHTS OF GST
(Please refer the GST Act / Rules framed hereunder, CBEC website
and other resources for details)
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Launched
w.e.f. 1st July, 2017
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It subsumes (replaces) various types of about 17 different types
of Central and State Taxes e.g. Excise Duty, Service Tax, Special Additional
Duty of Customs, Countervailing Duty, etc (Central Govt taxes) and also Value
Added Tax or Sales Tax, Entertainment Tax, (excluding the tax charged by the
local bodies), Entry and Octroi Tax, Central Sales Tax (taxed by the Centre
and collected by the State Government), Purchase Tax, Luxury Tax, Taxes on
Lottery, etc (State Govt Taxes).
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GST is a destination based consumption tax, which essentially implies that the revenue will accrue to the State where the consumer resides. This is unlike the present origin based levy where the revenue accrues to the origin state from where the movement originates. |
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If
the aggregate turnover of any person 20 Lakh, it is compulsory to take the
registration for him. In case of hilly states (North East States), this limit
is more than Rs. 10 lakhs.
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Except
NRI, PANCARD is required for registration. The GST Registration number is
consisting of 15 digits, which includes State code and PANcard Number.
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A
Goods and Services Tax Council is formed to solve the policy level issues of
under GST regime. The Council is headed by the Honourable Finance Minister.
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There 3 types of GST will be levied:
On Interstate transactions : Integrated GST (IGST)
On Intrastate transactions CGST and SGST will be levied
(UTGST will be levied on Union territory transactions)
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Tax rates: 0%, 3%, 5%, 12%, 18% and 28%
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Registered
taxable person will get Input Tax Credit (ITC) of tax paid on Input goods,
input services and capital goods.
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Petroleum products like petroleum crude, motor spirit (commonly
known as petrol), natural gas, Aviation turbine Fuel, tobacco products,
alcohol are temporarily out of the ambit of GST.
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If goods or services purchased from unregistered dealer, GST is
to be paid by Reverse charge Mechanism (the purchaser has to pay the GST to
Govt or Tax Liability will be increased).
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Though
invoices/bills can be raised manually, Returns are to be filed “on line”.
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1 per cent Tax Collected at Source (TCS) rate for e-commerce
(online suppliers) players will be levied
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Govt
has set up necessary system based on Information Technology for Registration,
Filing of Returns, Maintenance of Ledgers, Matching of Supplier’s /
Purchaser’s Invoices, etc. This is popularly known as GSTN (a Special Purpose
Vehicle).
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Taxpayers
who earn turnover of a financial year approximately are less than Rs. 75 Lakh
can opt for “Composition Scheme” which provides for easier compliance norms
for the suppliers. Service Sector (except hoteliers) is not eligible for this
scheme.
As
per the provisions of Composition Scheme, manufacturer will have to pay 2% GST,
Retailers will have to pay 1% GST and
hoteliers will have to pay 5% GST.
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GSTN
has engaged about 34 GST Suvidha Providers – GSP (entities from private
sector) to provide services to tax payers. These GSP have, in turn, engaged
Application Services Providers (ASPs) to provide services to tax payers. For
Tax payers, the ASP and GSP will be the link to upload the returns on GSTN.
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GST
is hailed as a landmark tax reformation in the country leading to smoother
movement of goods and services across the nation.
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