GOODS and SERVICES TAX IN iNDIA

1. ANALYSIS OF THE IMPACT
OF
GST IN INIDA
Submitted To: Submitted
By:
Mrs. Palika Mehta Virender
Tiwari

2. ACKNOWLEDGEMENT
I would like to convey my heartiest thanks to Mrs. Palika Mehta Ma’am, my project guide
who always gave me her valuable time and suggestions during the completion of this
project.
She has been a source of inspiration for me and she helped me in understanding and
remembering important and necessary details of the project.
I would also like to thanks to my all sir CA Mahesh shrivastav, CA Pradep Saini, CA
Ravindra Yadav, CA Saurav Agrawal who helped me a lot in this project and motivated me
a lot.
I would also like to thank god for giving me such wonderful guides who keep on guiding me
at every moment whenever I need them.

3. WHAT IS TAX AND THEIR TYPES?
Tax is obligatory contribution to the state revenue; the government of India levy on
the income of workers and business gains or added up to the cost of some
transactions. Goods and Services.
Types of taxes:
1. DIRECT TAX: The person paying the tax to the Government directly bears the
incident of the tax.
Progressive in nature - high rates of taxes for people having higher ability to pay.
2. INDIRECT TAX: The person paying tax to the government collects the same
from the ultimate customer. Thus, incident of the Tax is shifted to the other person.
Regressive in nature – All the consumer equally bear the burden, irrespective of
their ability to pay.

4. DIRECT TAX
• Banking cash Transaction Tax.
• Corporate Tax.
• Capital Gains Tax.
• Double Tax Avoidance treaty.
• Fringe Benefit Tax.
• Securities Transaction Tax.
• Personal Income-tax.
• Tax Incentives.
INDIRECT TAX
• Anti-Dumping Duty
• Custom Duty
• Excise Duty
• Sales Duty
• Service Tax
• Value Added Tax. Or VAT

5. INTRODUCTION TO GST
This Photo by Unknown Author is licensed under CC BY-SA-NC

6. GOODS AND SERVICES TAX(GST)
A Common Tax On
Goods Services

7.  GST firstly introduced by France.
 GST is a comprehensive value added tax on goods and services
 It is collected on value added at each stage of saleor purchase in the supply chain
 No differentiation between Goods and Services as GSTis levied at each stage in the supply
chain
 Seamless input tax credit throughout the supply chain
 At all stages of production and distribution, taxes are apass through and tax is borne by
the finalconsumer
 All sectors are taxed with very few exceptions / exemptions
 GST was introduce on 1st July 2017 under GST ACT 2017, the law was defined
by the constitution of India.
 Smt. Nirmala sitharaman is a minister of MIISTERY OF FINANCE of INDIA
 GST comes under MINISTRY OF FINANCE(MOF)
There are 2 separate boards has been defined by the MOF:
1. Central board of direct tax(CBDT): Income Tax notification will given by CBDT for
Income Tax.
2. Central Board of Indirect Taxes And Custom(CBIC): All indirect Tax notification
released by the CBIC only.

8. There are only 2 website available for GST
1. www.gst.gov.in for paying Goods & Services Tax
2. www.gstcouncil.gov.in for getting updates for the amendment done by the
government. As GST Is still on it’s maturity stage so in every 6 moths or less then
that government make some changes on GST payment portal to improve
experience of Taxpayers. And there are total 33 members in GST council who
brings Amandement for the better experience.
PURPOSE OF GST
The Two Important Purposes of GST are as followings:
• Single Umbrella Tax Rate: GST shall replace a number of indirect taxes being levied
by union and state government.
• Removing Cascading Effect: GST is intended to remove Tax on Tax Effect and
provides to common national market for Goods and Services.

10. TAXES SUBSUMED IN GST
• GST replaced several existing taxes and levies
which include:
 Central Taxes to Subsumed
 Central excise duty
 Services tax
 Additional customs duty,
 Surcharges & Cess
 CVD & SAD
 State Taxes to subsumed
 State-level value added tax
 Purchase Tax
 Luxury Tax
 Entry Tax
 Octroi
 Entertainment Tax

11. TAXES NOT SUBSUMED IN GST
Following taxes not to be subsumed under GST :-
State taxes :-
• State Excise Duty :- alcohol, alcoholic preparations, and narcotic substances.
ii. Stamp Duty
iii. Profession Tax
iv. Motor Vehicle Tax
v. Electricity Duty –Doubtful because of inclusion of electricity in the definition of term
“goods”
vi. Sale tax on five petroleum products :- Petroleum Crude, Motor Spirit
(petrol), High Speed Diesel, Natural Gas and Aviation Turbine Fuel
Central taxes :-
Customs Duty.

12. IMPLEMENTATION OF GST

13. GST Structure
Central GST State GST Integrated GST
GST to be levied by the
Central Government.
GST to be levied by
the State
Government.
GST to be levied by
the Centre and the
States concurrently.
Model of GST

14. BASIC TERMS
SGST -State Goods and Service Tax
i. It is applicable to intra-state sales (within the same state)
ii. It is collected by state Government.
CGST - Central Goods and Service Tax
i. It is applicable to intra-state sales (within the same state)
ii. It is collected by the Central Government.
iii. It replaces earlier taxes such as Central excise and Service Tax
IGST - Integrated Goods and Service Tax {CGST+SGST}
i. It is applicable to inter-state sales (between different states)
ii. It is collected by the Central Government on the inter-state sales.
iii. It replaces earlier taxes such as Central Sales Tax
UTGST – Union Territory Goods and Service Tax
i. The UTGST Act expands to Union Territory Goods and Service Tax.
ii. It is collected by the central government as UT comes under central Government.

15. ITC AVAILABILITY OF CGST, SGST & IGST
In this regards, the availability of ITC for set-off of tax liability also becomes crucial
for businesses across the country. The manner in which one can avail ITC against
each of these 3 taxes are as follows:
• CGST ITC – can be used to offset CGST and IGST (in that order)
• SGST ITC – can be used to offset SGST and IGST (in that order)
• IGST ITC – can be used to offset IGST, CGST and SGST (in that order)
Note:- CGST and SGST cannot be set off against one another.

16. RATES OF GST IN INDIA
RATES DESCRIPTIONS
0.25% to 3% For Gems & jewellery sector
5% Items of Mass consumption which are particularly used by common people
12% & 18% Standard rate ( phone, coaching fees etc.)
28% White Goods eg: Washing Machine, Ac’s, Refrigerator, consumer durable and some
notified services.
28& +
compensation
cess
Sin goods, Aeroted water, Demerits Goods, like pan masala, tobacco.
NOTE: Earlier there was a ‘Rate war’ but under gst regime there are 4 to 6 rates.

17. RATES OF GST IN OTHER COUNTRY
Name of Country GST Rates (in %)
Netherlands 21%
United Kingdom 20%
France 20%
Germany 19%
Russia 18%
China 17%
Pakistan 17%
Mexico 16%
New Zealand 15%
Australia, Brazil, Indonesia, Korea 10%
Japan, Switzerland 8%
Thailand, Singapore 7%
Malaysia 6%
Canada, Jersey 5%

18. TAXABLE EVENT
Before GST Tax event In GST Tax event
In GST, Tax levied on Supply
of Goods / Services based
on Place & Point of Supply.

19. GST IS A DESTINATION BASED TAX
1. Intrastate transaction (within the state) Eg: Ram(UP) sold pen to Raman (UP) (@18%)
CGST =9% Central Govt.
SGST= 9% UP Govt.
2. Interstate transaction (outside the state)
CGST =9% Central Govt.
SGST= 9% HP Govt. (As GST is a destination based Tax.)
Uttar Pradesh
(Ram)
Origin
Uttar Pradesh
(Raman)
Destination
INTRASTATE
Uttar Pradesh
(Ram)
Origin
Himachal Pradesh
(Raman)
Destination
INTERSTATE

20. STATES AND UT’S AS PER GST
1. J & K 11. NAGALAND 21. M P UT’S
2. H P 12. MANIPUR 22. GUJARAT 31. CHANDIGHAR
3. PUNJAB 13. MIZORAM 23. MAHARASHTRA 32. DELHI
4. UTTARAKHAN 14. TRIPURA 24. KARNATAKA 33. DAMAN AND DIU
5. HARYANA 15.MEGHLAYA 25. GOA 34. DADRA & Nagar
haveli
6. RAJASTHAN 16. ASSAM 26. KERALA 35. LAKSHWADEEP
7. U P 17. WEST BENGAL 27. TAMIL NADU 36. PUDUCHERRY
8. BIHAR 18. JHARKHAND 28. TELANGANA 37. ANDAMAN &
NICOBAR ISLANDS
9. SIKKIM 19. ODISHA 29. ANDHARA
PRADESH
10. ARUNACHAL
PRADESH
20. CHATTISHGHAR 30. ANDHARA
PRADESH (new)
NOTE:- DELHI AND PUDUCHERRY IS TREATED AS STATES AS THEY ARE UT’S BUT IN
CASE OF GST THEY ARE TREATED AS A SEPRATE STATE. AND THEY HAVE THERE
OWN LEGISLATIVE ASSMEBLY LIKE OTHER STATE HAVE. PUDUCHERRY WAS ALSO
KNOWN AS PONDICHERRY!!!

21. CLASSIFICATION OF
GOODS AND SERVICES TAX
1. HSN (Harmonised Systems of Nomenclature): is used for classifying the goods under
GST regime.
Taxpayers whose turnover is upto Rs.1.5 Crores are required to mention HSN code in their
invoices.
Taxpayers whose turnover is above Rs.1.5 Crores but below 5 crores shall use 2 digit code.
The Taxpayers whose turnover is Rs. 5 chore & above shall use 4digit code.
Here Turnover means: Annual Turnover of preceding financial year.
2. SAC Services (Services Accounting Code): The SAC code means services Accounting goes
under services fall under GST are classified.
A new scheme of classification of service has been devised wherein the services of various
descriptions have been classified under various sections, headings and groups. Each
groups consists of various service code(tariff). 6 digit Numeric value)
FOR EXAMPLE: SAC 999293 is for “Commercial training and coaching services”.

23. BASIC DIFFERENCE BETWEEN PRE-ENACTMENT OF GST
&
POST ENACTMENT OF GST
TOPIC BEFORE GST AFTER GST
Multiple Acts Many Acts prevailed before GST. There is only one Act i.e. GST ACT 2017
Cascading
Effects
Tax was collected on Tax. Tax paid by the taxable person, can be
utilized as input credit by other taxable
persons (Except Final Consumer.)
Double Taxation Single Commodity/ services was Taxed twice Single point Tax was charged on sale of
Goods/ Services.
Multiple
Taxable Event
Taxable liability arise on different events under
multiple Acts.
Taxable liability arises on supply as per GST
Act.
Multiple Tax Tax was paid under multiple challans to
different government bodies having multiple
due dates.
Tax is paid only under GST Act with one due
date to pay Tax. (Currently It’s 20th of next
month).
Multiple
Procedure
Multiple Returns and documents were required
to be submitted by different Acts.
Only single Sets of Returns and
documentation is required to be submitted in

24. WHAT IS CASCADING EFFECT?
• Without Cascading Effect (GOOD)
• With Cascading Effect (BAD)
Suppliers Price GST(@)18%) Invoice/BIll
A B Rs. 10,000 Rs. 1,800 Rs. 11,800
B
C
Rs. 12,000 (20% Value
Addition of Rs. 2,000 on base
price)
1800+360 (18% on 2000
added)
Rs. 14,160
(12,000+1,800+360)
C D Rs.14,400( 20% Value
addition of Rs. 2,400 on base
price)
1800+360+432(18% on
2,400)
Rs. 16992
(14400+1800+360+432)
Suppliers Price GST(@)18%) Invoice/BIll
A B Rs. 10,000 Rs. 1,800 Rs. 11,800
B C
Rs. 14160 (11800+2360
20% value addition on
invoice values i.e. Rs.
11,800)
1800+749(18% on 2360
added)
Rs. 16709
(14160+2549)
16709-
1800(ITC)=14909/-

25. BENEFITS/ADVANTAGES OF GST
Gst brings benefits to all stakeholders of industry, Government and the consumer. It’ll lower the
cost of gods and services, give a boost to the economy and make the products and services globally
competitive. GST is a win-win situation for the entire country. The significant benefits of GST are
discussed below.
No multiple Taxes
No cascading effect
No double Taxation
Uniformity in provision
Buoyancy to the government revenue
Boost to “Make India” initiative

26. LIMITATION OF GST
Increased costs due to software purchase
Being GST-compliant
GST will mean an increase in operational costs
GST came into effect in the middle of the financial year
GST is an online taxation system
SMEs will have a higher tax burden

27. OBJECTIVES OF THE RESEARCH UNDERAKEN: -
The research has been undertaken and presented considering the following foremost objectives:
1. To gain an in-depth understanding of GST taxation system evolution.
2. Understanding in - depth the concept of new taxation system introduced - Goods and Services
Tax (GST) in India.
3. Understanding the features, working, and differentiating the old taxation system in India v/s
GST.
4. To evaluate the advantages and challenges surrounding GST.
5. To evaluate the prospects of taxation position of various goods and services in India.
6. To furnish the information for future research on GST based taxation system.

28. CONCLUSION:-
 It can be concluded from the above discussion that GST will provide relief to
producers and consumers by providing wide and comprehensive coverage of input
tax credit set-off
 Efficient formulation of GST will lead to resource and revenue gain for both Centre
and States
 It can be further concluded that GST have a positive impact on indian sectors and
industry