Goods and Service Tax , CGST, IGST, SGST, price difference in VAT and GST

1. Goods and Service
Tax
By,
Anand Mohan
Sahrdaya Institute of Management studies, Kodakara

2. What is GST?
• Goods & Services Tax Law in India is a comprehensive, multi-stage,
destination-based tax that is levied on every value addition.
• GST is a tax on goods and services with value addition at each stage.
• GST will include many state central level indirect taxes.
• The Goods and Service Tax Act was passed in the Parliament on 29th
March 2017. The Act came into effect on 1st July 2017.

3. Buying raw materials
Sale to Wholesaler/
warehousingManufacture
Final sale to consumer Sale to retailer
VAT
VAT + Excise Duty
VAT
VAT

5. History of GST

6. GST Slabs

7. Components of GST
• CGST: Collected by the Central Government on an intra-state sale
(Eg: Within Maharashtra)
• SGST: Collected by the State Government on an intra-state sale
(Eg: Within Maharashtra)
• IGST: Collected by the Central Government for inter-state sale
(Eg: Maharashtra to Tamil Nadu)

8. Advantages Of GST
• Removing cascading tax effect.
• Online simple procedure under GST.
• Increased tax collection due to wider tax base.
• All goods & services are subjected to GST unless specifically exempted.
• Regulating the unorganized sector.
• Defined treatment for e-commerce.

9. Changes GST brought in
• No more hidden taxes.
• Check on price rise.
• Traders go digital.
• Check-posts removed.
• Price change of essential commodities.

10. Limitations of GST
• Change in Business Software
• GST Compliance
• Increase in Operating Costs
• Policy Change During the Middle of the Year
• Online Procedure
• No Clarity on Tax Holiday
• Disruption to Business