GST in India - An Introduction

Hello friends, Today I’m going to explain a topic “GST in India - An Introduction”.
Below is the summary of the blog.

Summary of the Blog:

• The Genesis of GST in India 
• Concept of GST
• Need for GST in India 
• Framework for GST as introduced in India 
• Benefits of GST 
• Constitutional Provisions

 The Genesis of GST in India 

Concept of GST

• VALUE ADDED TAX: GST is a value-added tax levied on the manufacture, sale, and consumption of goods and services. 
• CONTINUOUS and COMPREHENSIVE CHAIN OF TAX CREDITS: GST allows a complete and comprehensive continuous chain of tax credits from the producer’s point or service provider’s point up to the retailer level or consumer’s level through taxing only the value-added at an individual stage of the supply chain
• BURDEN BORNE BY FINAL CONSUMER: Only the final consumer bears the GST charged by the last supplier in the supply chain, with set-off benefits at all the previous stages.
• NO CASCADING OF TAXES: GST does not differentiate between goods and services and thus, the two are taxed at a single rate.

Need for GST in India 

The Amalgamation of different Central and State taxes into a single tax would assist

• Mitigate the double taxation,
• Cascading,
• The multiplicity of taxes,
• Classification issues,
• The taxable event, and etc.
• Leading to a common national market.
• Value Added Tax(VAT) standards and regulations change from state to state.

Framework for GST as introduced in India 

1. Dual GST
2. CGST/SGST/UTGST/IGST
3. Legislative Framework
4. Classification of Goods & Services
5. Composition scheme
6. Registration
7. Exemptions
8. Seamless flow of credit
9. GST common portal
10. GSPs (GST Suvidha Providers) /ASPs (Application Service Providers)
11. Compensation cess
12. GST - A tax on goods & services

 Benefits of GST 

• Removal of a group of indirect taxes such as CST(Central Sales Tax), VAT(Value Added Tax), Service tax, CAD(Current Account Deficit, SAD(Special Additional Duty), and Excise.
• Less tax agreement and a simplified tax policy related to the current tax formation.
• Removal of cascading effect of taxes i.e. removes tax on tax.
• Reduction of manufacturing costs due to the lower burden of taxes on the manufacturing sector. Therefore the prices of buyer goods will be expected to come down.
• Lower the burden on the common man i.e. public will have to discard less money to purchase the same products so were expensive earlier.

Constitutional Provisions

Thanks for reading friends, I will bring more such interesting topics related to taxation.

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