2. INTRODUCTION
GOODS AND SERVICE TAX (GST)
• GST is comprehensive tax mechanism where in all major
indirect taxes
are clubbed into one, whether they are levied on services(service
tax)
or goods(excise and vat).
• The goods and service tax is a Value Added Tax (VAT) to be
implemented in India, from April 2017.
• One of the aims of introducing GST is to reduce the cascading
effects
of taxes which is the primary focus of VAT but vat system is not
comprehensive enough to do so.
3. Components of GST:
CGST- Central goods and Service Tax.
SGST- State Goods and Service Tax.
IGST- Inter-State Goods and Service Tax.
4. GST
Central GST State GST
1. Central excise duty
2. Additional excise duty
3. Service tax
4. Countervailing duty(CVD)
5. Additional duty of customs(ADC)
6. Surcharge, Education and
Secondary/Higher secondary cess
1. VAT
2. Purchase tax
3. Entertainment tax
4. Luxury tax
5. Lottery tax
6. State surcharge and cesses
leviable on the above as of now
7. PRESENT TAX SYSTEM
Product sold from Nagpur to Chennai
Price = Rs 1100
Profit =1000
Sale Price =Rs2100
Product sold from Mumbai to Nagpur
Price = Rs 1000
VAT @ 10% = Rs 100
CST @ 10% = Rs 210
Total Cost
Rs -2310
8. GST SYSTEM
Product sold from Nagpur to Chennai
Price = Rs 1100
Profit =1000
Sale Price =Rs2100
Product sold from Mumbai to Nagpur
Price = Rs 1000
CGST @ 5% = Rs 50
SGST @ 5% =Rs 50
IGST @ 10% = Rs 210
Total Cost
Rs -2210
Less:
CGST
SGST
