Today GST is a much talked about topic. Presenting the highlights of GST-the biggest tax reform.
The Hon’ble President of India has given his assent to Goods and Services Tax on 12th April, 2017 to four bills. CGST, IGST, UTGST and SGST.
SGST is likely as compensation to States.
Highlights of GST:
- It is a DESTINATION BASED single tax on “Supply of Goods and Services” following the invoice method for maintaining credit mechanism as it seeks to consolidate many and different taxes and taxing statutes at the Central and the State level into a single, uniform and comprehensive tax structure.
- Taxable Event: Under the current Indirect Tax regime, taxable events are different. For example: ‘manufacture’, ‘sale of goods’, or ‘provision of service. Whereas now taxable event is single i.e. ‘Supply’.
- Rates: The GST Council has decided to adopt a four rate structure:
- Lower Rate – 5%
- Standard Rates of 12% and 18%
- Higher Rate 28%
- Zero Rated and exempted supplies
- Input tax credit: It would be allowed on all inward supply of Goods and Services except specifically restricted including inter state supplies.
- If a person is engaged in supply of services, credit on receipt of goods would be seamlessly available for set off against their output tax liability.
- Registration: No relevancy of Centralized registration under GST law. Every person effecting taxable supplies in a state would be liable to obtain registration in every such state.
- Valuation: Supplies without consideration between registration of same person and between related persons would be taxable based on a value determined by the Valuation Rules.
- Reverse Charge: All goods and services received by registered persons from unregistered persons would be liable to GST on reverse charge basis.
- New Concept: ‘Composite supplies’ and ‘mixed supplies’ have been introduced.
- Composite Supplies: Taxable as if the supply is wholly that of the principal goods / services.
- Mixed Supplies: Taxable as if it is wholly the supply of those goods / services which attract the highest rate of tax.
- Consideration: May be in terms of money or otherwise.
- Matching of credit: W.r.t inward supplies of recipient with outward supplies of supplier is mandatory for entitlement of credit in the hands of the hands of recipient.
- Filing of returns: Filing of returns is to be undertaken state wise on a monthly basis.
- Concept of GST Compliance: Rating has been introduced where a score is assigned to every registered dealer based on his record of compliance under the Act. A recipient will not be eligible to claim credits from suppliers whose GST Compliance falls below a threshold limit.
CA Asha Yadav
You May Also Like
To learn about How to Prepare for UGC NET click here?
To learn about subject UGC NET-Commerce-08-Business Environment click here.
To learn about subject UGC NET-Commerce-08-Business Management click here.
To learn about subject UGC-NET-Commerce-08-Financial Management click here.
To learn about subject UGC NET-Commerce-08-Business Economics click here
To learn about UGC Notifications visit cbsenet.nic.in