Goods And Service Tax (GST)

Goods And Service Tax (G S T) was INTRODUCED in India an 1 July 2017 To commemorate this historic occasion ,a function was held in the parliament on the midnight of 30 June 2017.

What is  G ST ?

1)It is an indirect tax system that subsumes various central and states indirect taxes.
2)It would apply on the supply of all goods and services except on exempted good and service ,goods which are outside the purview of G S T and the transaction which are below the prescribe threshold limits.

Value Addition Tax :
1)G S T is the single tax on the supply of goods and services ,right from the manufacture to the consumer.
2)Credit of input tax  paid at each stage will be available in subsequent stage  of value addition this make G S Tessential a tax only on value addition at each stage.

COMPONENTS OF G ST :
1)    Keeping in mind the federal structure of India ,there will be two components of  Gst
a)    Central   G S T
b)    State       G S T
2)    In case of inter state transaction the Centres would levy and collect the integrated Goods and Services G S T Under article  2 6 9 A 1 of the constitution to ensure seamless flow of input tax credit from one state to another . The G ST ROUGHLY be equal to C G ST  PLUS  S G S T.

STRUCTURE OF G S T : The G S T Council has decided the final structure  of of GS T has follows.
A four slab tax rate structure 5%,12%,18%, and 28% has been adopted for G S T. A  cess would be levied on certain goods such a luxury cars .aerated drinkks .pan masala  and tobacco products.

E WAY BILLS :It is an electronic billfor movement of goods which can be generated on  the G S T N.A movement of goods of value more than rs 50,0000 in value cannot be maeby  a ragistered person without an E way bills.

ANTI PROFITEERING RULES :
What is it?
These rules prevent entries from making excessive profits due to the G S T.

NEEDS OF THESE RULES:
It along with the input taxcredit ,is expected to bring down prices.

ROLE OF NATIONAL ANTI PROFITEERING AUTHORITY (N A A).:This N A A should be ensure that the benefit that encure to entries due to reduction in cost is passed on to the consumers.
Entries tht hikes rates inordinately ,citing G S T as the reason are kept in check.

BENEFIT OF G S T: A) It regarded as the biggest tax reform since independent willpave the way of realization of the goal of one nations.One tax one markets it will benefit at the state holdersnamely industries governments and consumers.
A)For central and state governments : 1)It is simple and easy to administers because multiple indirect taxes are being by a single taxes and it is backed with a robust end to end IT system
2) S T will result better tax compliance and reduced leakage due to robust  IT infrastructure and seamless transfer of income tax of input tax credit from one stage to another in the chain of value addition.
3)I T Is expected to decreased the cost of collection of tax revenue of the government ad will lead to higher revenue efficency.

B)FOR THE CONSUMERS :

1) I n the Earliar systems ,there were many simple there were many hidden taxes in the omparisions 
,the present system is tranparent.
2) I T Will reduced the overall tax burden on the most commodities by prevention of leakage and removing hidden tax .This will benefit consumers.
3) FOR BUSINESS AND INDUSTRIES :
1)It will lower business cost across most sectors.
2)It is expected to improve ease of doing business in INDIA as it will make INDIA one unified common markets.
3)A system of seamless tac credits throughout the value of chain and across boundries of states would ensures that there is minimal cascading of taxes.
4)It is expected to reduced taxation .I t will help bring INDIA informal sector into fold.

CRITICISM OF G S T:Some economic expert have levelled following criticism against the present model of G S T.

 There are too many rats and exemption.G S T should have been one standard tax rate,but it is not.We have rate of 0 .25, 3,5,12,18,28, and many higher rates depending upon the cases that may be imposed on so called "sin goods".Around 19% of the services have been under the higher slab of 28%
which cater to daily needs of middle class.Thus the middle class will now have to bear the burnt of higher prices.G S T should have been under one unified tax authority ,but it is not .There will be diarchy  .State and the centre will divide the tax bases into 90-10(for turn over under rs 15 million )and 50-50-(for turn over over rs 15 million).There is a ambiguity about the anti profiteering rules as do not lay down the formula base on which the extent of profiteering can be determined.This tasks have been done left to the N A A.G S T should have given a trial run of two month before it was finally rolled out but it was not.

CONCLUDING REMARKS :It is not perfect but both it positive and negative are being exaggerated .Perfecting i will take sometime as seen in other nations.No matter what ,the launch should be applauded because it is start to process.