2. What is Goods and Services Tax (GST)
• Goods and Services Tax (GST) is an indirect tax
applicable throughout India which replaced multiple
cascading taxes levied by the central and state
governments.
• GST paid on the procurement of goods and services
can be set off against that payable on the supply of
goods or services. But being the last person in the
supply chain, the end consumer has to bear this tax
and so, in many respects, GST is like a last-point
retail tax.
3. HISTORY OF GST
• France was the first country to implement the
GST in 1954.
• Then Germany, Italy, the Uk, South Korea,
Japan, Canada and Australia have been over
a dozen nations which Implemented the
GST.
• There are 161 countries implement GST.
4. Background in India
• The effort to introduce the new tax regime was reflected,
for the first time, in 2006-2007 Union Budget Speech.
• The then Finance Minister Mr. P. Chidambaram remarked
that there is a large consensus that the country must move
towards a national level GST that must be shared between
the center and the states.
• He proposed 1 April, 2010 as the date for introducing
GST. After successful introduction of Value Added Tax
(VAT) in almost all the states and continuous increase in
number of services under the service tax net.
• Finance Minister Pranab Mukherjee while presenting the
Budget on July 6, 2009, said that GST would come into
effect from April 2010.
5. Types Of GST
1. CGST – Central Goods and Service Tax.
2. SGST – State Goods and Service Tax.
3. IGST - Integrated Goods and Service Tax.
9. Goods And Services Act(GST)
• Touted as “Single biggest Indirect Tax reform” since 1947.
• GST aims to simplify the indirect tax regime with a single
tax on manufacture, sale and consumption of goods and
services at national level.
• No distinction is made between
• A study conducted by NCAER estimated that roll out of
GST would boost the India’s GDP growth by 1% to 2%.
• It is a consumption based tax.
• It would subsume most of the indirect taxes of the centre
and the state.
• It is a tax on goods and services with value addition at each
stage of transaction(sales, manufacture and consumption).
• Based on Input credit system just like VAT.
• Overcomes most of the drawbacks of the current system.