GST
Full form of GST is Goods and Service Tax. It was introduced in India on
1st July, 2017. It replaces the previous Central and State indirect taxes like
CST, Excise duty, VAT and Service Tax. GST is often referred to as “one
Nation, one Tax” because it adopts uniform tax rate on similar goods and
services all over the country.
Features of GST
There are four types of GST. They are:-
a) CGST (Central Goods and Service Tax):- charged on intra state supply.
b) SGST (State Goods and Service Tax):- charged on intra state supply.
c) IGST (Integrated Goods and Service Tax):-charged on interstate supply
d) UTGST (Union Territory Goods and Service Tax):-charged on supply
within union territory.
GST is equally distributed between central and state govt in an intrastate
sale and between central govt and the union territory govt in sale within a
union territory
Input tax credit ican be availed in B2B (Business to Business) supply and
Zero rated supplyii
Input tax credit cannot be availed on exempt suppliesiii
Input tax credit reduces the price of goods to the consumer.
Branch to Branch transfer also attracts GST though the recipient branch
can avail input tax credit later on.
GST rates
a) 0% (Exempt):-Unbranded essential items, agriculture products, basic
health services, primary and secondary education
b) 3%:- Gold jewelry
c) 5%:-On essential packaged food products and household goods
, d) 18%:-On other goods and Luxury goods, services like telecom, banking
etc
e) 40% on super luxury goods like luxury cars and sin goods like tobacco.
Registration Under GST is compulsory if the annual turnover iv of the busi-
ness
a) Exceeds Rs 40 lakhs for goods in normal category states
b) Exceeds Rs 20 lakhs for goods in special category states v
c) Exceeds Rs 20 lakhs for services in normal category statesvi
d) Exceeds Rs 10 lakhs for services in special category states
A business has to register under GST even if its turnover does not exceeds
the thresh hold limit but there is an interstate sale of goods or services.
GST Registration is free of cost.
No GST is charged on zero rated supply.
IGST is charged on imports and supplies made by SEZ
Some Goods like petroleum products, alcohol for human consumption and
services like electricity are kept out of the preview of GST.
There are two type of schemes under GST
a) Regular scheme
b) Composition scheme
Business opting for regular scheme pays GST to the govt at normal appli-
cable rates. It issues “Tax invoice” to its customers
A 15 digit PAN based GSTIN (GST identification number) is assigned to a
business registered under GST.
It is optional for an entity carrying out more than one business with in a
state to apply for more than one GST registration number.
It is compulsory for an entity carrying out businesses in different states to
apply for separate GST registration number in each state
Full form of GST is Goods and Service Tax. It was introduced in India on
1st July, 2017. It replaces the previous Central and State indirect taxes like
CST, Excise duty, VAT and Service Tax. GST is often referred to as “one
Nation, one Tax” because it adopts uniform tax rate on similar goods and
services all over the country.
Features of GST
There are four types of GST. They are:-
a) CGST (Central Goods and Service Tax):- charged on intra state supply.
b) SGST (State Goods and Service Tax):- charged on intra state supply.
c) IGST (Integrated Goods and Service Tax):-charged on interstate supply
d) UTGST (Union Territory Goods and Service Tax):-charged on supply
within union territory.
GST is equally distributed between central and state govt in an intrastate
sale and between central govt and the union territory govt in sale within a
union territory
Input tax credit ican be availed in B2B (Business to Business) supply and
Zero rated supplyii
Input tax credit cannot be availed on exempt suppliesiii
Input tax credit reduces the price of goods to the consumer.
Branch to Branch transfer also attracts GST though the recipient branch
can avail input tax credit later on.
GST rates
a) 0% (Exempt):-Unbranded essential items, agriculture products, basic
health services, primary and secondary education
b) 3%:- Gold jewelry
c) 5%:-On essential packaged food products and household goods
, d) 18%:-On other goods and Luxury goods, services like telecom, banking
etc
e) 40% on super luxury goods like luxury cars and sin goods like tobacco.
Registration Under GST is compulsory if the annual turnover iv of the busi-
ness
a) Exceeds Rs 40 lakhs for goods in normal category states
b) Exceeds Rs 20 lakhs for goods in special category states v
c) Exceeds Rs 20 lakhs for services in normal category statesvi
d) Exceeds Rs 10 lakhs for services in special category states
A business has to register under GST even if its turnover does not exceeds
the thresh hold limit but there is an interstate sale of goods or services.
GST Registration is free of cost.
No GST is charged on zero rated supply.
IGST is charged on imports and supplies made by SEZ
Some Goods like petroleum products, alcohol for human consumption and
services like electricity are kept out of the preview of GST.
There are two type of schemes under GST
a) Regular scheme
b) Composition scheme
Business opting for regular scheme pays GST to the govt at normal appli-
cable rates. It issues “Tax invoice” to its customers
A 15 digit PAN based GSTIN (GST identification number) is assigned to a
business registered under GST.
It is optional for an entity carrying out more than one business with in a
state to apply for more than one GST registration number.
It is compulsory for an entity carrying out businesses in different states to
apply for separate GST registration number in each state
