Comparison of GST with current indirect tax system, Genesis of GST, and its implication.

1. Goods and Services
Tax
Constitution (122nd
Amendment) Bill,2014
Goods and Service Tax

2. Contents
 Current Indirect Tax
System
 Introduction to GST
 Comparison
 Impact
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3. Goods and Service Tax (GST) is a comprehensive tax levy on
 manufacture,
sale and consumption
of goods and service, under which no distinction is
made between goods and services for levying of tax.
What is GST ?
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4. Our Current Indirect Tax System
Central Taxes
State Level
Taxes
Excise Duty
Service Tax
Custom Duty
Entry tax / Octroi
VAT Entertainment Tax
Goods and Service Tax
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5.  As per Mr. Narendra Modi GST- Great Step towards
Transformation
Introduction of GST
 GST will be a game changing reform for Indian economy
 Eliminating the Cascading Effect of Tax
 Complete Overhaul of the current indirect tax system.
 Far reaching impact on almost all the aspects of the business
operations
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6. France was the first country
to introduce GST in 1954.
History
Worldwide, almost 160 countries
have introduced GST in one or the
other form since now.
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7.  The idea of moving towards the GST was first mooted by the then
Union Finance Minister Shri P. Chidambaram in his Budget for 2006-07
 The Empowered Committee of State Finance Ministers (EC) was
formulated
 Come up with a roadmap and structure for the GST.
 The EC released its First Discussion Paper (FDP) on the GST in
November, 2009.
 The basis for discussion between the Centre and the States so far.
 Model of GST law has been formulated on 14 June 2016 as Goods and
Services Tax Act, 2016.
Genesis
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8. Implication of GST
GST would be a destination based tax as against the present
concept of origin based tax.
Free movement of goods and services and no Cascading effect
GST would apply to all goods and services except Alcohol for
human consumption, Electricity and Real Estate.
GST on petroleum products would be applicable from a date
to be recommended by the GSTC.
Compensation to the States for loss of revenue arising on
account of implementation of the Goods and Services Tax for
a period of five years
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9. GST Model
Total 117
GST @18% 21.06
S.B.C @0.20% 0.230
K.K.C @0.20% 0.230
Total (incl all taxes) 138.52
Comparison
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10. NO
Initially, GST was a single centralized indirect tax in which tax is to be
collected by center and then distributed between center and state
government.
It was rejected at the initially stage only.
Both the state and central government will
impose and collect tax on single transaction
State Goods and
Service Tax(SGST)
Central Goods and
Service Tax(CGST)
GST
Is GST a single tax?
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11. Impact of GST across Sectors
MEDIA
DTH, film
producers and
multiplex players
levy service tax as
well as
entertainment tax.
Impact:-
Taxes would go
down by 2-4%
TELECOM
Positive:-
Handset prices
would come down.
Negative:-
Call charges data
rates will go up, if
GST rate exceeds
15% and the
proposed rate is
18%
E-commerce
Positive:-
Single unified market
with free movements
of goods
Negative:-
GST regime will
increase
administration,
documentation
workload for
ecommerce firms and
push up costs.
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12. Goods and Service Tax
Thank You
Made by:- Rishabh Aggarwal (301)
Epsilon
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