GST knowledge - Complete Guide to Goods and Service Tax and Legal Concern

The Goods and Service Tax (GST)  is a single unified tax system which is based on the destination principle. Under this principle, tax is levied on goods and services in the place where they are consumed rather than where they are produced. It is also known as consumption tax. The purpose of GST is to unite India’s complex taxation system under ‘ One Nation, One Tax ’. To achieve this purpose, 17 central and state taxes will be subsumed, which would lead to removal of multiplicity of taxes and the cascading effect of tax on tax. This would lead to creation of a common market for all. Presently, several taxes are levied on sale and purchase of goods, namely, central excise duty, service tax, customs duty, central sales tax , VAT, countervailing duty (CAD) and special additional duty (SAD). These taxes shall be subsumed under Dual GST model except the customs duty. In the present tax regime, goods and services are taxed separately. Goods come under the purview of VAT while se

Goods and Service Tax (GST) is an indirect tax based on the destination principle which will be levied on the manufacture, sale and consumption of goods as well as services at the national level. GST will subsume 17 indirect taxes when it is rolled-out on July 1. The advent of GST would usher in a host of benefits not limited to but including the removal of cascading effect of taxation i.e. incidence of tax on tax. The cascading effect of multiple tax levies acts like a hidden cost which makes Indian goods and services uncompetitive in the domestic and international market. To eliminate this effect of tax on tax, GST Bill was tabled before the Parliament. In the present tax regime, no tax credit was given for goods purchased outside the state however under GST, traders and businessmen can claim input tax credit. Similarly, excise duty could not be claimed unless the distributor re-produced the product and paid excise duty on the product.  Let us understand t

GST - India's Biggest Tax Reform Goods and Service Tax or GST is an indirect tax that will subsume 17 different taxes and ultimately we will be left with One Nation, One Tax. Even though on surface GST may look like a complex web of newly minted tax reform, we will help you understand GST in 5 simple ways listed below. Impacts of Goods and Services Tax  Variance Between Present Tax Regime and GST Currently, goods and services are taxed differently. Excise duty is levied on goods at the time of manufacturing and VAT is levied at the time of sale of goods. While services attract levy of service tax only. On the other hand, GST does not make any differentiation between goods and services. Under the GST regime, all activities pertaining to the supply side of transaction including sale, transfer, lease, and import of goods and/or services would attract GST. Moreover, the line of distinction between the manufacturer and trader would lose its significance under GST as both goods

Payment Of Tax Under Model GST Law We will be discussing the payment process under GST which has undergone a change since any payments above Rs. 10,000 are mandated to be made electronically or through cheque. In order to make tax payments under GST regime, three different ledgers need to be maintained namely, electronic tax liability ledger, electronic cash ledger and electronic credit ledger.  Let us study these ledgers in detail. Electronic tax liability ledger (GST PMT1) : Every taxpayer registered under GST must maintain an electronic tax liability ledger that would keep a record of an individual’s liabilities such as due tax, interest, penalty, late fee under separate heads. All the liabilities of a taxpayer are debited in the electronic tax liability ledger. Electronic cash ledger (GST PMT5) : Every taxpayer registered under GST must maintain an electronic tax liability ledger that would keep a record of an individual’s each deposit made towards tax, interest, p