Top points of GST in India

Top points of GST in India

In this article, we will bullet information about the " Top points of GST ". India is famous for its horrible tax system. That is the biggest burden for the new businesses and startups to go through from this various direct tax and indirect tax. Regular changes in the tax rates make scenario much worst. Now one revolutionary change is going to happen in Indian taxation system called GST or Goods and Services Tax. We will discuss what is GST, how it’s going to make things simpler, GST’s applicability, GST rates and every aspect as well as the impact of GST and the top point of GST A person called Mr Reddy who wants to start a business. For this, he needs various raw materials which must be imported from Japan and will need to be brought to Bengaluru – where he has his production unit – by surface transport through various states. Due to complex tax structure estimation of cost is quite tough.below we will discuss on Top point of GST. Petrol prices are the absolute example. The bulk answerable to dealers by the Oil Marketing Companies is Rs. 25.46 currently for a litre of petrol. Now Excise Duty is calm at Rs. 21.48 per litre by the Central Government and abacus the banker agency the bulk now is Rs. 49.22. This is not the end and Amount Added Tax is now answerable at 27% which takes the final bulk to Rs. 62.51 in Delhi. At aboriginal, it may assume fair that both the Governments tax the artefact but it is not that innocuous. There is a tax on a tax here! The State Government accuse 27% of the final bulk in which Central Excise Duty has already been borne by the businessman. The Top point of GST will help this kind of problem and empower the economic growth of India. It will be the biggest taxation reform in Indian taxation system. That also restrict the flow of black money, force tax payables to come in the main stream.

How does GST Calculation happen?

Before going to Top point of GST, Let us accept that the GST is set at 20%. Suppose that the accomplishment bulk of a Product A is 100 and bold a GST of 20% the absolute bulk is Rs. 120. The next footfall of taxation would be if the Product is awash to consumers, let’s say at the amount of 150. So, the GST will allegation addition 20% on just the aberration of Rs. 150 and Rs. 120 i.e. alone 20% on Rs. 30 which is according to Rs. 6. So the final amount is Rs. 150 + Rs. 6. Unlike the case of petrol appraisement, there is no tax on a tax now. This eliminates the bottom word after effect of taxes which is actually accustomed in our abridgement and has been simplified to basal akin in the example. Since the GST will be activated at every footfall of amount conception it will be actually difficult for atramentous money owners to participate anywhere in the amount alternation with the GST after accounting for all added transactions. The GST is estimated to accommodate an actual addition of 0.9% – 1.4% of the GDP.

Important question about GST (Top points of GST)

1) What are final GST rate slabs?

Finally, GST fixed its rate slabs, which range from 0% to 28%. GST Council finalised a four-tier GST tax structure of 5%, 12%, 18% and 28% lower tax rate is for the all the essential items higher tax rate for non-essential and luxury goods. Service Tax reaches 18% from 15%. Some essential services come on the lower rate like train tickets. To control inflation, the essential food item will have taxed at zero rates. Lowest rate slab 5% for common use items. There are two standard rates 12% and 18% for Fast Moving Consumer Goods (FMCG). Ultra-luxuries, bankrupt and sin appurtenances (like tobacco and aerated drinks), will allure assessment for an aeon of 5 years on top of the 28 per cent GST. The accumulating from this assessment as able-bodied as that of the apple-pie activity assessment would actualize an acquirement basin which would be acclimated for compensating states for any accident of acquirement during the aboriginal 5 years of accomplishing of GST.

2) What are CGST, SGST and IGST?

As we all know India is a federal democratic country, here union and state both have their clear power and responsibilities, the power to collect the revenue between central and state authority. So, that’s it was very essential for the GST Council to make clear provision that can prevent the overlapping of revenue collection rights.

1. CGST: Central Goods and Service Tax areas where the Central Government has the power to charge the Tax.
2. SGST: State Goods and Service Tax areas where the State Government has the power to charge the Tax.
3. IGST: Integrated Goods and Service Tax where the tax has been charged by states of the Indian union, initially it will be collected by the union then transferred to the states.

3) How the UPA’s GST and the NDA’s GST is different?

1. Petroleum sector has been kept out from the GST rule.
2. Liquor, tobacco products all came under the GST rule.
3. There is a 1% tax on top of the GST for inter-state movement of goods and services.

4)Taxes which has been replaced by GST?

1. Central Excise Duty
2. Service Tax
3. Countervailing Duty
4. Special Countervailing Duty
5. Value Added Tax (VAT)
6. Central Sales Tax (CST)
7. Octroi
8. Entertainment Tax
9. Entry Tax
10. Purchase Tax
11. Luxury Tax
12. Advertisement taxes
13. Taxes applicable on lotteries.

5) What will be the short-term impact of GST?

GST will boost up the inflation for short term. GST rate will increase the cost expenses of restaurants, movies etc. According to experts say, not the inclusion of liquor and petroleum will create a funnel to create black money to tax paying population.

6) GST implementation date?

GST will be implemented from 1st July 2017

7) Member of Empowered Committee?

Finance Ministers of the States are the member of Empowered Committee.

8) What will become costlier and cheaper?

According to experts, these items could become costlier:And these could become cheaper

1. Tobacco product will become more expensive.
2. Commercial vehicles such as truck etc.
3. Mobile calling rate.
4. Textile and branded product.
5. Auto: Prices of entry-level cars, two-wheelers, SUVs may fall
6. Car batteries likely to get cheaper
7. Paint, cement prices likely to fall
8. Movie ticket prices likely to fall as entertainment tax will come down
9. Electronics items like fans, lighting, water heaters, air coolers, etc. will get cheaper. For any Professional support login on!!