GST is a comprehensive indirect tax on the supply of goods and services throughout India that replaces multiple taxes levied by the central and state governments. It aims to create a single, unified Indian market to make India a common economic market. When implemented, GST will eliminate tax cascading and provide seamless tax credits, thereby reducing the overall tax burden on goods. It is expected to simplify and rationalize indirect tax structure in India and improve economic growth.
4. A sells goods to B after charging sales
tax
Then B re-sells those goods to C after
charging sales tax
While B was computing his sales tax
liability, he also included the sales tax
paid on previous purchase
7. Feb ,2006:First time introduced concept of
GST and announced the date of its
implementation in 2010
Feb .2007: F.M. Announced introduction of
GST from 1April2010 in Budget
The Government came out with a First
Discussion Paper on GST in November , 2009
Introduced the 115 th Constitution
Amendment (GST) Bill in the year 2011.
8. GST
‘G’ –Goods
‘S’ –Services
‘T’ –Tax
1. Goods and Service Tax (GST) is a
comprehensive tax levy on manufacture,
sale and consumption of goods and service
at a national level.
2. GST is a tax on goods and services with
value addition at each stage.
3. GST will include many state and central
level indirect taxes
4. It overcomes drawback present tax
system
10. TAXATION POWERS
OF CENTRE
• Income Tax – on income, other than agricultural income
• Excise Duty – on goods manufactured or produced in
India
• Custom Duty – on imports and exports
• Service Tax – on specified services
• Central Sales Tax – on inter-State sale of goods
11. TAXATION POWERS OF STATES
• VAT/Sales Tax - on purchase or sale of goods, other than
newspapers, within a State
• Excise duty - on alcoholic liquor for human consumption
• Land Revenue
• Tax – on agricultural income
• Toll tax
• Professions, Trades, Callings and Employments
• Luxuries, including taxes on entertainment, betting and
gambling
13. 1. A sale or supply includes a sale of goods
2. Lease of premises
3. Hire of equipment
4. Giving advice
5. Export of goods and supply of other things.
14. • Central Taxes
Excise Duty
Additional Excise duty
Service Tax
CVD, SAD
Surcharge
• State Taxes
VAT
Entertainment tax levied by states
Luxury Tax
Tax on Lottery
Entry tax other than for local bodies
TAXES Proposed TO BE
SUBSUMED IN GST
15. • Central Taxes
Specific Cess
Excise duty on tobacco products
• State Taxes
Items containing alcohol
Entertainment tax (Local Bodies)
Entry tax for local bodies
Electricity duty
TAXES NOT BE INCLUDED
IN GST
20. What is GOODS AND SERVICE TAX
• Goods and Service Tax is a tax on goods and services.
• It is leviable at each point of sale or provision of service.
• This is simply very similar to VAT.
• It can be termed as National level VAT on Goods and
Services.
• Only difference in this system is that not only goods but
also services are involved.
• The rate of tax on goods and services are generally the
same.
21. GST-AT A GLANCE
Roadmap to GSTRoadmap to GST
Recommend united effort for mega tax reformRecommend united effort for mega tax reform
To develop roadmap & milestonesTo develop roadmap & milestones
To build consensus with States, Center & Empowered CommitteeTo build consensus with States, Center & Empowered Committee
Create awareness and acceptance for GSTCreate awareness and acceptance for GST
VAT
GST
Extend scope to
Inter-state Sales
Bring AED items
under VAT
CST phase-out
Move to single VAT
rate of 8%
Extend scope to
Inter-state Sales
Shift to destination
based VAT
Integrate Services, Imports & CENVAT
27. GST will simplify India's tax structure, broaden the tax base, and create
a common market across states. This will lead to increased compliance
and will support India's GDP growth.
It will be beneficial for India Inc. as the average tax burden on
companies will fall due to transparent set-off mechanism and
elimination of cascading taxes leading to reduced production costs and
increased export competitiveness.
GOODS AND SERVICES TAX
28. Why do we need GST
today ?
GOODS AND SERVICES TAX
29. • In Indian economy the service sector
contributes over 55%.
• Separate taxation of goods and
services is neither viable nor desirable
• Value added in manufacture and sale of
goods require inputs of both — goods
and services and vice versa, which is
often not separable
31. • CGST – To be administered by Central
Government.
• SGST – To be administered by State
VAT Department
• Inter State Transaction – To be
administered by A common Centralized
Authority
37. • More than 140 countries have already
introduced GST/National VAT.
• France was the first country to introduce GST
system in 1954.
• Standard GST rate in most countries ranges
between 15-20%.
40. Let us see the formulaof the CurrentAccountBalance (CAB)
CAB = X -M + NI+ NCT
X = Exports of goods and services
M = Importsof goods and services
NI = Net income abroad [Salariespaid orreceived,
credit /debitofincomefrom
FII&FDIetc.]
NCT= Net current transfers [Workers'Remittances
(unilateral),Donations, Aids&
Grants,Official, Assistance and Pensionsetc]
CURRENT ACCOUNT DEFICIT
Hope you have now
understood the concept of
Goods and Services Tax.
GOODS AND SERVICES TAX