2. HISTORY OF GST
Started: France (1954)
Model: Canada
GST: 17 Indirect Taxes
President: Signed 8 September
2016
Implemented: 1 July, 2017
3. WHAT IS GST?
Two types of taxes: Direct tax and Indirect
tax.
The Goods and services tax (GST) is an
Indirect tax on goods and services sold
domestically for consumption.
The tax is included in the final price and paid
by consumers at point of sale and passed to
the government by the seller.
Goods and services are divided into five
different tax slabs for collection of tax: 0%,
5%, 12%, 18% and 28%.
4. TYPES OF GST
SGST (State Goods and Services
Tax)
CGST (Central Goods and Services
Tax)
IGST (Integrated Goods and
Services Tax)
UTGST (Union Territory Goods and
Services Tax)
5.
6. GSTIN: The Goods and Services Tax Identification Number (GSTIN) is a
15-digit alphanumeric unique identification number.
7. GSTN: The Goods and Service
Tax Network (GSTN).
The Goods and Service Tax
Network (GSTN) is a non-profit,
non-government organization
which manages the entire IT
system of the GST portal
8. IMPORTANT TERMS AND DEFINITIONS UNDER GST
CAPITAL GOODS: Section2(19)
“Capital goods” means goods, the value of which is capitalized in the books of
account of the person claiming the input tax credit and which are used or intended
to be used in the course or furtherance of business.
GOODS: Section 2(52)
“Goods” means every kind of movable property other than money and securities
but includes actionable claim, growing crops, grass and things attached to or
forming part of the land which are agreed to be severed before supply or under a
contract of supply.
9. Continuous Supply of Goods - Section 2(33)
As per section 2(33) of the CGST Act, 2017, “continuous supply of goods”
means a supply of goods which is provided, or agreed to be provided,
continuously or on recurrent basis, under a contract, whether or not by
means of a wire, cable, pipeline or other conduit, and for which the
supplier invoices the recipient on a regular or periodic basis and includes
supply of such goods as the Government may, subject to such conditions,
as it may, by notification, specify.
Examples of continuous supply of goods are – Internet, Water, Gas,
Electricity, Telephonic service, Construction contract.
10. Composite Supply of Goods - Section 2(30)
As per section 2(30) of the CGST Act, 2017, “composite supply of goods”
a supply made by a taxable person to a recipient consisting of two or more
taxable supplies of goods or services or both, or any combination
thereof, which are naturally bundled and supplied in conjunction with each
other in the ordinary course of business, one of which is a principal supply.
Examples of composite supply of goods are – Restaurant service,
Construction work, Train tickets with food, Goods transported with
insurance.
11. Taxable Person Section2(107)
Is an person who carries on any business at any place in any state of India
and who is registered or required to be registered under GST
Any person who engages in economic activity including trade and
commerce is treated as a taxable person.
12. Non-Resident Taxable Person Section2( 77)
Non-resident taxable person” means any person who occasionally
undertakes transactions involving supply of goods or services or both,
whether as principal or agent or in any other capacity, but who has no fixed
place of business or residence in India.
A non-resident taxable person cannot exercise the option to pay tax under
composition levy.
13. Electronic commerce or Ecommerce
Section2(44)
E-commerce or Electronic commerce which simply means supply of
goods and services through electronic mode over the internet moreover, in
legal term Electronic Commerce has been defined in Sec. 2(44) of
the CGST Act, 2017 to mean the supply of goods or services or both,
including digital products over digital or electronic network.
14. Mixed Supply Section2(74)
Mixed supply under GST means a combination of
two or more goods or services made together for a
single price.
Each of these items can be supplied separately and
is not dependent on any other.
Under GST, a mixed supply will have the tax rate
of the item which has the highest rate of tax.
15. Input Tax Credit (ITC) Section2(63)
Input Tax Credit means claiming the credit of the
GST paid on purchase of Goods and Services which
are used for the furtherance of business. The
Mechanism of Input Tax Credit is the backbone of
GST and is one of the most important reasons for the
introduction of GST.
As GST is a single tax levied across India (right from
manufacture of goods/ services till it reaches the end
customer), the chain does not get broken and
everybody is able to take benefit of the same and
there is seamless flow of credit.
16. Reverse Charge Section2(98)
Generally, the supplier of goods or services is liable
to pay GST. However, in specified cases like imports
and other notified supplies, the liability may be cast
on the recipient under the reverse charge mechanism.
Reverse Charge means liability to pay the tax is on
the person receiving goods/services instead of the
person supplying the goods/services in respect of
specified categories of supplies.
Reverse charge under GST is applicable on services
as well as on goods
