Special Economic Package or AatmaNirbhar Bharat: 1st Phase

Hello friends, Today I’m going to explain the topic "Special Economic Package or AatmaNirbhar Bharat: 1st Phase"

You can read my previous Blogs "Coronavirus(COVID-19): Impact on Real Estate in India", "Coronavirus(COVID-19): Key Announcements on Income Tax, GST, Finance and others", "GST Framework in India" & "GST in India - An Introduction"

The Union Finance Minister Smt Nirmala Sitharaman announced the 1st Phase of the Economic Relief Package following the Public Address of the Prime Minister on 12th May 2020. The Prime Minister, announced a special economic package of around Rs 20 lakh crores, amounting to 10% of India’s GDP during his speech to Spur growth, and to build "AatmaNirbhar Bharat"

Keeping with the vision of the Prime Minister, Finance Minister made her announcement for businesses including MSMEs and emphasized that in the wake of COVID-19, there is a need for liquidity, Ease of doing business, and reducing the compliance burden and due diligence. In light of the same, she announced

16 Measure Comprising

• 6 for Micro, Small & Medium Enterprise (MSME)
• 2 for Employee Provident Fund (EPF) 
• 2 measures for Non-Banking Finance Companies (NBFCs), Housing Finance Companies (HFCs), Micro Finance Institutions (MFIs)
• 1 for The DISCOMS or Power Distribution Companies
• 1 for Contractors
• 1 for Real Estate 
• 3 for Tax Measures.

Micro, Small & Medium Enterprise (MSME)

1.  Rs. 3 lakh crores Collateral-free automatic loans for business, MSMEs

• Borrowers having outstanding up to Rs. 25 Crores and turnover of Rs. 100 crores are eligible to take credit
• The tenure of the loan would be 4 years with a moratorium of 12 months on Principal repayment.
• There will be a 100% credit guarantee cover to Banks and NBFCs on principal and interest.
• This scheme can be availed till Oct 31, 2020
• It has been clearly specified that there would not be any guarantee fee or fresh collateral requirement for availing benefit under the scheme.

2.  Rs. 20,000 crores subordinate debt for stressed MSMEs

• Rs. 20000 crores to be infused as subordinate debt for stressed MSMEs
• The government will provide Partial Credit Guarantee Support for this purpose to banks.

3.  Rs.50,000 crores equity infusion for MSMEs through funds of funds

• In order to address the issue of a severe shortage of equity in MSMEs during these tough times, The Govt. has proposed to set up Funds of Funds (FoF) with a corpus of Rs. 10,000. The corpus would provide equity funds for MSMEs with growth potential and viability. The FoF will be operated through Mother Fund and few Daughter funds.
• The fund structure will help leverage Rs. 50,000 cr. Of funds at daughter funds level. This step would help to expand MSME size as well as capacity and will also encourage listing of MSMEs on the main board of stock exchanges.

4.  Amendment to Definition of MSME

5.  Government expands the scope for global tenders for MSMEs

• Tenders up to Rs. 200 crores relating to Government procurement not be Global Tenders any more 

6.  Other Measures 

• All Central Government (CG) outstanding will be cleared within 45 Days by Government help all MSME

Employee Provident Fund (EPF)

7.  Employees Provident Fund (EPF) support for Business and Workers

• Govt. had proposed under the Pradhan Mantri Garib Kalyan Package (PMGKP), EPF payments by another 3 months i.e. June, July & August Government to pay 12%+12% i.e. each by employer and employee for wage earner below Rs. 15000 p.m. and business having less than 100 workers.

8.  Reduction in EPF contribution for the next 3 months

• The Statutory Provident Fund contribution for both Employee and Employer has been reduced from 12% to 10% for all establishments covered by EPFO (Employee Provident Fund Organisation) for Government undertaking the contribution shall remain at 12%.

Non-Banking Finance Companies (NBFCs), Housing Finance Companies (HFCs), Micro Finance Institutions (MFIs)

9.  Special Liquidity Scheme

• Rs 30000 crores for Special Liquidity Scheme; liquidity being provided by RBI. The investments will be made in both primary and secondary market transactions in the investment-grade debt paper of these institutions.

10.  Partial Credit Guarantee Scheme

• Rs 45000 crores partial credit guarantee scheme for liabilities of NBFCs/MFIs. The First 20% loss will be borne by Guarantor, i.e. GoI.

 The DISCOMS or Power Distributor Companies

11.  One time money infusion for DISCOMS

• Liquidity infusion in the DISCOMS to the extent of Rs 90000 crores in 2 equal installments. The amount could be used by the DISCOMS to pay their dues.

Contractors

12.  6 months Extension

• Give Extension up to 6 months Government contractor of Railways, Roads, other Departments, etc.

Such extension shall be given for complying with the Contract Conditions, completion of works, and other intermediary milestones. The concession period under PPE Contracts may also be extended by 6 months.

Real Estate

13.  Extension of Registration and Completion Date of Real Estate Projects under RERA 

• Project Registration to be extended by 6 months; completion dates of existing projects to be extended by 6 months.
• This measure will indeed de-stress real estate developers and ensure completion of projects so that home buyers are able to get delivery of their booked house with new timelines.

Tax Measures

14.  List of Announcements

• TDS and TCS rates reduced by 25% of the existing rates. The revised rates will come into effect from 14th May 2020 and will be in effect till 31st March 2021. This relief shall not be available to a salaried and non-resident taxpayer.
• The Due dates for all ITRs (Income Tax Returns) for Financial Year 2019-2020 extended from 31st July 2020 and 31st October 2020 to 30th November 2020.
• Tax Audit for Financial Year 2019-2020 extended from 30th September 2020 to 31st October 2020.
• The period for Vivad se Vishwas Scheme has been extended to the 31st December 2020.
• Due date of 30th September 2020 for completion of assessments shall be extended to 31st December 2020. Where assessments are getting barred on 31st March 2021, it shall be extended to 30th September 2021.

15.  Rate of TDS

The reduced rate of TDS will apply on payment made for the contract, professional fees, interest, rent, dividend, commission, and brokerage income. This will be applicable between 14th May 2020 till 31st March 2021. Non-salaried specified payments made to residents, TDS rates will be reduced by 25% of the existing rates.

16.  Rate of TCS

• The rate of TCS has also been reduced by 25% of the existing rates for the period from 14th May 2020 till 31st March 2020

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Coronavirus (COVID-19): Impact on Real Estate in India

Hello friends, Today I’m going to explain a topic "Coronavirus (COVID-19): Impact on Real Estate in India"
You can Read my previous Blog "GST in India - An Introduction", "GST Framework in India" & "Coronavirus (COVID-19): Key Announcements on Income Tax, GST, Finance and others"

Summary of the Blog:

1. Residential Real Estate 
2. Commercial Real Estate 
3. Industrial Real Estate 

1. Residential Real Estate

• Housing sector 

According to the Ramesh Nair, CEO & Country Head of JLL India "The injected liquidity of Rs 3.74 lakh crore (by the RBI) along with the 3 months moratorium on all term loans by financial institutions will alleviate short-term liquidity concerns and help developers as well as homebuyers . It is a big relief for developers and buyers to help them mitigate the challenges faced by them currently"
Niranjan Hiranandani, National President, NAREDCO, states that "Salvaging Indian realty, the second-largest employment generator is critical, not only from the GDP growth perspective but also for employment generation, since the sector has a multiplier effect on 250-plus allied industries."
Housing market in India’s top 9 cities (October-December 2019)
Sales                            Down 30%
Project launches          Down 44%
Inventory                     778,627 units
Source: PropTiger DataLabs

https://m.rbi.org.in/scripts/FS_FAQs.aspx?Id=77&fn=2

UCO Bank: The bank has announced the 3 months EMI moratorium on its term loans up to May 31, 2020.
Syndicate Bank: The bank has said, "EMIs of housing loan, vehicle loans, Micro, Small and Medium Enterprise (MSME) loans and payment of all other term loans falling due after 1st March 2020 and upto 31st May 2020 have been deferred by 3 months."

• Home Buyers 

(i) According to the survey by 99acres.com "40% of the prospective homebuyers, who were searching flats for purchase before the lockdown, have postponed their plan while 60% are still keen to buy within the next 12 months."
(ii) Major reasons for delaying their plan to buy were uncertainty in the market (56%) and financial factors (30%), the realty portal said.
(iii) As many as 75% preferred to search for homes online, the survey said

2. Commercial Real Estate

• Office Space 

According to JJL’s report, titled COVID-19 Global Real Estate Implications. “Office utilisation rates will fall as remote working increases and landlords with exposure to short-term leases are the most vulnerable as delay to investment activity and softer rental growth than previously forecast are headwinds to 2020 performance.”

Companies worldwide have announced remote working for employees to contain the virus spread, triggering a debate if Work from Home could replace office space in future.

Demand for remote working and investment in collaboration technologies would grow.
Fast-tracking a widespread adoption of these practices.

• Mall Operators 

“Low footfalls and subsequent closure of malls will impact developers’ debt servicing against the project. Even a relaxation from banks for the short-to-medium term should not have a big impact. However, if the virus scare continues beyond one to two quarters, debt servicing challenges may last for a longer period,” points out Rohan Sharma, research head, Cushman and Wakefield.

Niranjan Hiranandani, National President, NAREDCO, states that “The impact of COVID-19 in the form of shutdown of retail outlets and malls as also entertainment and fitness centers has put commercial real estate deals on a wait-and-watch mode.”

3. Industrial Real Estate

• Builders 

The government is expected to launch support measures for the developer community in order to offset the losses they will suffer on account of the Coronavirus spread, including allowing the force majeure clause to skip penalties over project delays. The 3 months EMI holiday for developers during the crucial period is one measure to offset their losses.

Niranjan Hiranandani, National President, NAREDCO, states that “The pandemic menace has hit at a particularly sensitive time. Across realty companies, this is the time when statutory payouts and streamlining of balance sheets happens. In this challenging time, we have asked the government for some economic interventions like rescheduling loan repayments, a one-time rollover for debt restructuring and deep interest rate cut.”

• Construction sector 

Construction-related Gross Value Added (GVA) and employment are expected to reduce between 15% to 34% and 11%to 25%, respectively, when compared to pre-crisis projections for Financial Year 2021.
Labour costs for skilled workers are expected to rise by 20%-25% while that for semi-skilled workers and unskilled workers is pegged to increase by 10%-15%.
Projects that are under development or Work-in-Progress are likely to take a severe hit with a minimum delay of 2 to 3 months, depending on their geography and spread of COVID-19 in and around the project site.

Indian real estate after Coronavirus: Top 11 projections
Source : Housing.com 

• Site visits to drop, impacting sales numbers.
• Project completion deadlines to extend, pushing completion farther.
• Overall cost of project to increase amid delays and supply constraints.
• Inventory levels to increases, intensifying pressure on builders.
• Prices might move slightly upwards despite the slow demand.
• Home loan interest rates to fall after repo rate cut to 4.4%.
• Remote working to gain traction in future as businesses embrace work from home culture.
• Higher investment likely in future office spaces to make them better prepared for crisis situations.
• Occupancy levels in office spaces to decline in the near term as remote working picks up.
• NRI investment in real estate may improve amid rupee fall.
• Cases of builder insolvency might increase as liquidity situations worsens

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Coronavirus (COVID-19): Key Announcements on Income Tax, GST, Finance and others

Hello friends, Today I’m going to explain a topic "Coronavirus (COVID-19): Key Announcements on Income Tax, GST, Finance, and others". 

You can read my previous blogs "GST in India- An Introduction" & "GST Framework In India"

The Union Finance Minister Smt Nirmala Sitharaman made a number of announcements on 24th March 2020 via video conferencing related to statutory and regulatory compliance matters and some reliefs for businesses to cope up with the difficult times of COVID-19.

Below is the summary of the Blog:

Summary

• Income Tax
• Goods & Services Tax (GST)
• Customs
• Financial Services
• Corporate Sector OR Ministry of Corporate Affairs (MCA)
• Insolvency and Bankruptcy Code (IBC)
• Fisheries 

Income Tax

The last date for

• Belated/Revised filing of ITRs for the FY 18-19 
• Permanent Account Number (PAN) and Aadhar linking 
• “Vivad se Vishwas” scheme no additional 10% payment

Extended from
31st March 2020 to 30th June 2020

Issue of notice, intimation, notification, approval order, sanction order, filing of an appeal, furnishing of return, statements, applications, reports, any other documents and time limit for completion of proceedings by the authority and any compliance by the taxpayer including investment in saving instruments or investments for rollover benefit of capital gains under Income Tax Act, Wealth Tax Act, Prohibition of Benami Property Transaction Act, Black Money Act, Securities Transaction Tax (STT) law, Commodities Transaction Tax (CTT) Law, Equalization Levy law, Vivad Se Vishwas law where the time limit is expiring between March 20,2020 to June 29,2020 shall be

Extended to 30th June 2020 

Interest at a reduced rate of 9% p.a. shall be charged alternately of 12% or 18% p.a. towards the delayed payment/deposit of the following income tax levies, made between March 20,2020 and June 30,2020.

Note that there is no extension in the deadlines.

• Advance Tax
• Tax Deduction at Source (TDS)
• Tax Collection at Source (TCS)
• Self-assessment tax
• Equalization levy
• Security Transaction Tax (STT)
• Commodity Transaction Tax (CTT)

Goods & Services Tax (GST)

The last date for the

• GST Returns for March, April & June 2020 on a staggered basis 
• Opt for composition scheme 
• Sabka Vishwas scheme from 31st March 2020 with no Interest charges
• Issuance of notice, intimation, notification, approval order, sanction order, filing of an appeal, furnishing of return, statements, applications, reports, any other records where the time limit expires between March 20,2020 and  June 20,2020
• Penalty fall to 5% interest on late filing of GST returns beyond 15 days for firms having turnover up to Rs. 5 crore

Extended to 30th June 2020 

Customs 

The taxpayers and/or the tax authorities have got an extensive time limit of up to June 30,2020 where the time limit for the following compliance matter lapses between March 20,2020 and June 29,2020:

• Issue of notice, notification, approval order, sanction order, Filing of an appeal, furnishing of applications, reports, or any other documents.
• Customs clearance will operate 24*7 to help Exporters and Importers up to  June 30,2020.

Financial Services 

• You can now withdraw money from any Bank ATM without charges for 3 months.
• Minimum balance charges waived off for bank accounts.
• There shall not be any minimum balance requirement fees (in Bank accounts). 
• In the case of Digital Trade transactions, Bank charges are being reduced.

Corporate Sector

• The requirement of holding board meetings has been relaxed for 60 days for two quarters. 
• Newly incorporated companies will be given an additional 6 months for declaration of commencement of business. 
• For 2019-20, if independent directors have not been able to hold a single meeting, it will not be seen as a violation.
• Applicability to Create Deposit Reserve of 20% of deposits by April can now be complied with by 30 June 2020.
• Requirements of Auditor's Report order 2020 which was assumed to come into force for Financial Year 2020 will be effective from Financial Year 2021.

Insolvency and Bankruptcy Code (IBC)

Insolvency is a financial position of being – one that is reached when you are unable to pay off your debts or obligations on time.
Bankruptcy is a lawful process that serves the purpose of resolving the issue of insolvency.

• Finance Minister Nirmala Sitharaman's government's move to consider raising the threshold limit to file any action under IBC from Rs. 1 lakh to Rs. 1 crore has come as a huge relief booster shot for SMEs (Small and Medium Enterprises), SSMEs (Sustainable Small and Medium Enterprises) and small businesses.
• Insolvency and Bankruptcy Code (IBC) Section 7 (Initiation of corporate insolvency resolution process by the financial creditor), Section 9 (Application for initiation of corporate insolvency resolution process by the operational creditor), Section 10 (Initiation of corporate insolvency resolution process by corporate applicant) may be considered for 6 months if Economic scenario becomes worse. This will prevent companies from being forced into Insolvency and Bankruptcy Code (IBC) for default if the scenario worsens.

Fisheries

• All the Sanitary Imports Permits (SIP) for the import of SPF Shrimp Broodstock and other Agriculture inputs which expires between 1st April 2020 and 15th April 2020 has been extended by 3 months
• Delay in arrival of import consignments by up to 1 month will not be considered as ‘delayed receipts’. 
• The time limit for the verification of documents and grant of NOC for quarantine has been relaxed from 7 days to 3 days.

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GST Framework In India

Hello friends, Today I’m going to explain a topic "GST Framework In India"

You can read "GST in India - An Introduction"

1. DUAL GST

The Dual GST (Goods and Services Tax), was launched in India to clarify the entire GST process system. GST was launched so that the whole taxation system would become less complicated therefore delivering the economy rise. The Dual GST system was introduced so that the whole process could become less complicated. This also helped in obtaining the quote ‘One Nation One Tax’ true. So let us understand Dual GST.

Dual GST is a type of GST in which both SGs and CGs will levy GST individually, rather than center alone levying taxes and sharing their revenues with the states. They will have various rates and possibly different commodities and services in which they are levied.

Diagram:

The Components of Dual GST are:

1.CGST (Central GST)

2.SGST (State GST)

3.UTGST (Union Territory GST)

4.IGST (Integrated GST)

2. CGST/SGST/UTGST/IGST

CGST

Central Goods and Services Tax or CGST is the indirect tax levied by the Central Government (CG). It is levied on the transaction of goods and services which are initiated within the state i.e. intrastate. 

SGST

State Goods and Services Tax or SGST represents the tax imposed by the State Government(SG). SGST is levied on the transaction of intra-state sales of goods and services, i.e. sales made within a state.

UTGST

UTGST is exactly the way linked to SGST. The only variance is that the tax revenue goes to the treasury for the particular direction of union territory where the goods or services have certainly been used. There is a key differentiation between union territory and states. The Union Territory immediately comes under the direction of the Central Government and does not have its own elected legislature as in the case of States.

IGST

IGST is levied on all inter-state supply of goods and services by the Central Government. CGST, SGST & UTGST which are levied upon the supply of goods or services within a state.

IGST has given a uniformity to taxation on the supply of goods and services made outside the state. These practices both at a supply made outside the state and those made outside the country.

3. LEGISLATIVE FRAMEWORK

There is single legislation – GGST Act, 2017 for levy GST similarly,

• Union Territories without Legislatures:
• Andaman and Nicobar Islands
• Chandigarh
• Daman and Diu
• Dadra and Nagar Haveli
• Lakshadweep
• Ladakh
• Jammu & Kashmir

Union Territories with their own legislatures:

• Ponducherry
• Delhi

There are 35 GST Act in India:

4. CLASSIFICATION OF GOODS & SERVICES

Harmonised System of Nomenclature (HSN) is used for classification of Goods:

HSN codes to be declared:

- In the case of Imports/Exports, the HSN code of 8 digits shall be compulsory.

Definition HSN Code?

HSN code stands for “Harmonized System of Nomenclature”. This system has been entered for the methodical classification of goods all over the world. HSN code is a 6-digit uniform code that classifies 5000+ products and is accepted globally. It was developed by the World Customs Organization (WCO) and it came into force from 1988.

Work of HSN code?

It has about 5,000 product groups, each named by a six-digit code, designed in a legal and logical arrangement. It is recommended by well-defined rules to perform consistent classification.

Importance of HSN? 

The main objective of HSN is to categorize goods from all over the World in a precise and relevant way. This draws in an identical classification of goods and facilitates worldwide commerce.

HSN Worldwide

The HSN scheme is accepted by more than 200 countries and economies for purposes such as:

• Uniform classification
• Base for their Customs tariffs
• Collection of international trade statistics

Over 98% of the commodities in worldwide trade is analyzed in phases of the HSN.

HSN number for each product is affirmed by most of the countries. The HSN number remains the same for almost all goods. Though, HSN number used in some of the countries varies little, based upon the kind of goods listed.

HSN in India

India is a member of the World Customs Organization (WCO) since 1971. It was basically using 6-digit HSN codes to analyze commodities for Customs and Central Excise. Succeeding Customs and Central Excise added two more digits to make the codes more accurate, appearing in an 8 digit analysis.

HSN importance under GST?

The purpose of HSN codes is to make GST precise and globally accepted.

HSN codes will remove the need to upload a detailed interpretation of the goods. This will save time and make filing easier since GST returns are automatic.

A dealer or a service provider must provide an HSN/SAC wise report of sales in his GSTR-1 if his turnover falls in the above slabs.

HSN - wise summary of outward supplies

Sections	HSN Code List for
Section 1	Live Animals, Animal Products
Section 2	Vegetable Products
Section 3	Animal or Vegetable Fats and Oils and their cleavage stocks, made nutritious fats, Animal or Vegetable waxes
Section 4	Prepared Foodstuffs, Alcohols, Spirits and Vinegar, Tobacco and Manufactured Tobacco Substitutes
Section 5	Mineral Products
Section 6	Product of the chemicals or allied Industries
Section 7	Plastics and articles thereof, Rubber and articles thereof
Section 8	Raw hides, skins, Leather, Furskins and pieces thereof, saddlery, harness, travel goods, handbags, associated containers, articles of animal gut (other than silkworm gut)
Section 9	Wood, articles of wood, Wood charcoal, Cork, articles of cork, Manufacturers of straw, Esparto or other Plaiting Materials, Basketwork, and Wickerwork
Section 10	Pulp of wood or another Fibrous Cellulosic Material, Improved (Waste and scrap) paper or paperboard and articles
Section 11	Textile and textile articles
Section 12	Footwear, Headgear, Umbrellas, Sun Umbrellas, Walking-sticks, seat-sticks, whips, riding-crops, and parts thereof, Prepared feathers and articles formed therewith, Artificial flowers, Articles of human hair
Section 13	Pieces of stone, plaster, cement, asbestos, mica, or related materials, ceramic products, glass and glassware
Section 14	Cultivated pearls, valuable or semi-valuable stones, valuable metals, Metal clad with valuable metal, and pieces thereof, Imitation Jewellery, Coins
Section 15	Base Metals and Articles of Base Metal
Section 16	Machinery and mechanical devices, electrical devices, parts thereof, sound recorders and reproducers, television picture and such recorders and reproducers, and Components and Accessories of such article
Section 17	Vehicles, Aircraft, Vessels and Associated Transport Equipment
Section 18	Optical, Photographic, Cinematographic, measuring, checking, precision, medical or surgical devices and equipment, clocks, musical devices, and accessories thereof
Section 19	Arms and ammunition, parts and accessories thereof
Section 20	Miscellaneous Manufactured Articles
Section 21	Works of art, Collectors' Pieces, and antiques

Services Accounting Code (SAC) is used for classification of Services:

- 8 digit code of which first 2 digits is zero

Definition of SAC?

Service Accounting Code is related to the International HSN codes selected by other countries across the world. Similarly in GST the applicability of Service Accounting Codes has been determined for distinguishing the applicability of the individual tax rates to the services.

Importance of SAC?

SAC is the nomenclature adopted by the Goods and Services Tax Council for identifying services delivered under GST. These codes have been issued by the Central Board of Excise and Customs (CBEC) for the Identical classification of all the services as each service has been named a distinct SAC.

Work of SAC?

SAC Code is a labeling system for services formed by the Service Tax Department of India. Using GST SAC code, the GST rates for services are set in five slabs namely 0%, 5%, 12%, 18%, and 28%.

https://cbic-gst.gov.in/gst-goods-services-rates.html

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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

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