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. 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
4. Advantages of GST :
Ease of doing business
Attractive for foreign investors
FDI
No tax evasion
Inventory cost will fall
Make in India
Common market
Manufacture goods could become cheap
GDP lift
5. 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
6. 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
