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PRESENTED BY-ASHIWANI SAHU
Registration No. –
Dr. Harisingh Gour University, Sagar
Department Of Business Management
Table Of Content
S. No. Content Slide No.
1 Introduction Of GST 3
2 Historical Background Of GST 4
3 Objectives Of GST 5
4 Tax Structure of GST 7 & 8
5 Types Of GST Or Taxes Under GST 9
6 Rate Structure Of GST 10
7 Items Out From The GST Criteria 12
8. Advantage Of GST 13
9 Disadvantage Of GST 18
10 GST : Impact On GDP 21
11 Conclusion 23
12 References 24 & 25
Introduction Of GST
 GST is one indirect tax for the whole nation,
which will make India one unified common
market.
GST is a consumption based tax levied on
sales, manufactures, consumption goods &
services at a national level. This tax is
substitute for all indirect tax levied by state
and central government.
Historical background of GST
 GST was first recommended by Vijay Kelkar Task Force
on implementation of Fiscal Reforms and Budget
Management Act 2004 .but the First Discussion Paper
on Goods and Services Tax in India was presented
by the Empowered Committee of State Finance
Ministers dtd.10th November 2009. In 2017 – GST
Council finalizing the GST Rules and GST Rates.
and finally
1 JULY 2017 GST LAUNCHED IN INDIA
OBJECTIVES OF GST
 To eliminate the cascading effect of Indirect taxes on
single transaction.
 Subsume all indirect taxes at Centre and State Level
under GST.
 Reduce tax evasion and corruption.
 Increase productivity.
 Increase Tax to GDP Ratio and revenue surplus.
 Increase Compliance.
 One Country – One Tax.
 Uniform GST Registration payment and Input tax
Credit methods.
Why GST is Important in India
The current structure of taxes in India is a rat trap. The
wide powers to levy and collect taxes provided to states
and central government. as a result, both levy different
kinds of taxes which makes the Indian tax structure
very much complex and a complex economy too. The
small scale industries In India continuously suffering
from these problems. So there are need to change Tax
structure in India. For organize tax structure There is
need to launch GST in India.
Tax structure Before GST
Tax
Structure
Direct
Tax
Income
Tax
Wealth
Tax
Indirect
Tax
Central
Tax
Excise
Service
Tax
Custom
State
Tax
VAT Entry Tax,
Luxury
tax,
Lottery
Tax, etc.
Tax
Structure
Direct
Tax
Income
Tax
Wealth
Tax
Indirect Tax = GST
(Except customs)
CGST
(Central)
SGST
(State)
IGST
(Central)
Types of GST
Or
Taxes Under GST
1. CGST(Central Goods and Service Tax)- which will
be levied by Centre Government.
2. SGST(State Goods and Service Tax)- Which will be
levied by State Government.
3. IGST(Integrated Goods and Service Tax)- Which
will be levied by Central Government on inter-State
supply of goods and services.
GST Rates Structure
Tax
Rates
Products
0%
(EXEMPT)
•Milk
•Eggs
•Curd
•Lassi
•Unpacked
Foodgrains
•Unpacked Paneer
•Gur
•Educations Services
•Kajal
•Children’s Drawing &
Colouring Books
•Unbranded Natural
Honey
•Prasad
•Besan
•Unbranded Maida
•Unbranded Atta
5% •Edible Oils
•Domestic LPG
•PDS Kerosene
•Cashew Nuts
•Milk Food for
Babies
•Coir Mats, Matting
& Floor Covering
•Fabric
•Spices
•Coal
•Roasted Coffee Beans
•Apparels (< Rs.1000)
•Footwear (< Rs.500)
•Skimmed Milk Powder
•Life-saving drugs
•Coffee (except instant)
•Mishti/Mithai (Indian
Sweets)
•Agarbatti
Tax
Rates
Products
12% •Butter
•Ghee
•Almonds
•Umbrella
•of Plants
including Pickle
Murabba, Chutney,
Jam, Jelly
•Preparations of
Vegetables, Fruits,
Nuts or other parts
•Fruit Juice
•Mobiles
•Processed
•food
•Computers
•Packed Coconut
Water
18%
•Hair Oil
•Toothpaste
•Soap
•Pasta
•Corn Flakes
•Soups
•Printers
•Computers
•Toiletries
•Ice-cream
•Industrial
Intermediaries
•Capital goods
28%
•Small cars (+1% or
3% cess)
•Consumer
durables such as
AC and fridge
•High-end
motorcycles (+15%
cess)
•Beedis are NOT
included here
•Luxury & sin items
like BMWs, cigarettes
and aerated drinks
(+15% cess)
Items out from the criteria of GST
 PETROL
 CRUDE OIL
 GAS
 DIESEL
 Aviation turbine fuel
 Alcohol for human consumption
 Electricity
 Beneficial for small traders and service
providers
As per the current VAT structure, any business with a turnover
of more than Rs. 5 lakh (in most states) is liable to pay VAT
(different rates in different states). But After GST This Limit
increased to Rs. 20 lakhs . So many small traders and service
providers will be exempt from GST.
Simpler online procedure under GST
The entire GST process – starting from registration to filing
returns and payment of GST tax – is online. So we do not have
to run around to tax offices to get various registrations under
excise, VAT, service tax.
Advantage of GST
 Lesser number of compliances
GST unified all different types of Tax procedures, thereby reducing
the number of returns and the time spent for tax compliances .
There are 4 are basic returns ,which apply to all taxable persons
under GST.
 Composition scheme for small businesses
GST also has an optional scheme of lower taxes for small
businesses with turnover between Rs. 20 to 50 lakhs. It is called the
composition scheme. It has now been proposed to be increased to
75 lakhs. This will bring respite from tax burdens to many small
businesses.
 Defined treatment for e-commerce
Many Indian businesses provide goods and services through the
internet. Earlier, there were no specific provisions for treatment of
the e-commerce sector. Currently, states have variable VAT laws for
this sector. All these differential treatments and confusing
compliances will be removed under GST.
 Regulating the unorganized sector
Certain industries in India like construction and textile are
largely unregulated and unorganized. GST has provisions
for online compliances and payments, and availing of input
credit only when the supplier has accepted the amount,
thereby bringing accountability and regulation to these
industries.
 No hidden taxes
GST will not be a cost to registered retailers .So there will
be no hidden taxes and and the cost of doing business .
transparency
GST will also help to build a transparent and corruption
free tax administration.
 Removing cascading tax effect
An important benefit of the introduction of GST
will be the removal of the cascading tax effect. In
simple words, “cascading tax effect” means a tax on
tax.
For Example -
A trader buys A Product for Rs. 20,000 paying 5%
(Rs. 1,000) as tax. 15% service tax on services of Rs.
50,000.
Currently, he has to pay Rs. 50,000*15% = Rs. 7,500
without getting any deduction of Rs. 1,000 VAT already
paid on above Product.
Under GST (assuming GST= 18%)
GST on service of Rs.
50,000 @18%
9,000
Less: GST on Product
(20,000*18%)
3,600
Net GST to pay 5,400
Disadvantage of GST
 Increase in Operating Costs
Most small businessman in India has traditionally preferred to pay
taxes and file returns on their own to save costs. But GST is completely
new system. So that the small businesses will have to bear the
additional cost of hiring experts.
 Higher Tax Burden for Manufacturing SMEs
Under the excise laws, only manufacturing business with a turnover
exceeding Rs. 1.50 crores had to pay excise duty.
But under GST the turnover limit has been reduced to Rs. 20 lakh, thus
increasing the tax burden for many manufacturing SMEs.
 Sometimes dual Taxation
GST is being referred as a single taxation system but in reality it is a dual
tax in which state and centre both collects separate tax on a single
transaction of sale and service.
 Online Procedure
GST compliance, return filing and payments all have
to be done online. Many small businesses are not
tech-savvy and do not have the resources for fully
computerized Tax System.
 Costlier Service – Before GST system Service Tax
rate was 15% ,but now it will increase to 18%-20%
after GST. As such many services will be costlier.
telecom, airline and banking services will majorly
affected by GST.
 Registration in the Many States Required–As per
GST, the seller would require registering in all the
states that it does business in and that would
increase the complexity for the seller.
 Disability Tax – Opposition has called it as a Disability
Tax as many of the things related to disabled people
which were earlier Tax-Free are now included in GST
Taxation. Prior to implementation of GST, brail paper,
typewriter, hearing aid and motorized wheelchair were
tax-free whereas these things are being taxed now.
 overhead expenses - businesses will need to train
their employees in GST compliance. this will also
increase their overhead expenses.
 minimal exemption list - GST is not good news for all
sectors, though. In the previous system, many products
are exempted from taxation. The GST proposes to have
minimal exemption list.
GST : Impact On GDP
 In a report issued by the Finance Ministry, it was
mentioned that Make In India program will be
more benefited by the GST structure due to the
availability of “input tax credit” on capital goods.
 GST would be the key revolution in Indian
Economy and it could increase the GDP by 0.9 to
1.7 percent.
GST Positive Impact On
GDP
GST Negative Impact on GDP
 As we know Real Estate also plays an important role in
Indian economy but some expert thinks that GST will
impact the Real Estate business negatively .it will add up
the additional 8 to 10 percent to the cost and reduce the
demand about 12 percent.
 As the GST rates are 5%, 12%, 18% and 28% and if the GST
rate on service will be finalized at 5% or 12% then cost of
services will get reduced while in else case if the rate will be
18% or 28% on services then services will become costlier
and it will lead to inflation for a short period.
 In a report, DBS bank noted that initially GST will lead to
rise in inflation rate which will remain for a year but after
that GST will affect positively on the economy.
CONCLUSION
As every coin has two faces in the same way
we tried here to familiarize the things
related to GST with both perspective i.e.
positively and negatively . Despite having
some factor which is being expected to
affect the Economy adversely ,there are so
many other things which are expected with a
positive impact on GDP.
References
 DISADVANTAGE Of GST
http://www.gstindia.com/gst-with-examples/
http://www.worldblaze.in/advantages-and-
disadvantages-of-
 GST Rates
https://cleartax.in/s/gst-rates
 Why GST is Important in India
http://www.businessalligators.com/gst-impact-rates-
type-
P.T.O
 Items out from the criteria of GST
http://howtoexportimport.com/3-commodities-not-
fall-under-
GST-in-India-4272.aspx
 Impact on GDP
http://blog.saginfotech.com/gst-impact-on-gdp-india
 GST registration
https://cleartax.in/s/gst-registration
GST(Goods And Service Tax)

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GST(Goods And Service Tax)

  • 1. PRESENTED BY-ASHIWANI SAHU Registration No. – Dr. Harisingh Gour University, Sagar Department Of Business Management
  • 2. Table Of Content S. No. Content Slide No. 1 Introduction Of GST 3 2 Historical Background Of GST 4 3 Objectives Of GST 5 4 Tax Structure of GST 7 & 8 5 Types Of GST Or Taxes Under GST 9 6 Rate Structure Of GST 10 7 Items Out From The GST Criteria 12 8. Advantage Of GST 13 9 Disadvantage Of GST 18 10 GST : Impact On GDP 21 11 Conclusion 23 12 References 24 & 25
  • 3. Introduction Of GST  GST is one indirect tax for the whole nation, which will make India one unified common market. GST is a consumption based tax levied on sales, manufactures, consumption goods & services at a national level. This tax is substitute for all indirect tax levied by state and central government.
  • 4. Historical background of GST  GST was first recommended by Vijay Kelkar Task Force on implementation of Fiscal Reforms and Budget Management Act 2004 .but the First Discussion Paper on Goods and Services Tax in India was presented by the Empowered Committee of State Finance Ministers dtd.10th November 2009. In 2017 – GST Council finalizing the GST Rules and GST Rates. and finally 1 JULY 2017 GST LAUNCHED IN INDIA
  • 5. OBJECTIVES OF GST  To eliminate the cascading effect of Indirect taxes on single transaction.  Subsume all indirect taxes at Centre and State Level under GST.  Reduce tax evasion and corruption.  Increase productivity.  Increase Tax to GDP Ratio and revenue surplus.  Increase Compliance.  One Country – One Tax.  Uniform GST Registration payment and Input tax Credit methods.
  • 6. Why GST is Important in India The current structure of taxes in India is a rat trap. The wide powers to levy and collect taxes provided to states and central government. as a result, both levy different kinds of taxes which makes the Indian tax structure very much complex and a complex economy too. The small scale industries In India continuously suffering from these problems. So there are need to change Tax structure in India. For organize tax structure There is need to launch GST in India.
  • 7. Tax structure Before GST Tax Structure Direct Tax Income Tax Wealth Tax Indirect Tax Central Tax Excise Service Tax Custom State Tax VAT Entry Tax, Luxury tax, Lottery Tax, etc.
  • 8. Tax Structure Direct Tax Income Tax Wealth Tax Indirect Tax = GST (Except customs) CGST (Central) SGST (State) IGST (Central)
  • 9. Types of GST Or Taxes Under GST 1. CGST(Central Goods and Service Tax)- which will be levied by Centre Government. 2. SGST(State Goods and Service Tax)- Which will be levied by State Government. 3. IGST(Integrated Goods and Service Tax)- Which will be levied by Central Government on inter-State supply of goods and services.
  • 10. GST Rates Structure Tax Rates Products 0% (EXEMPT) •Milk •Eggs •Curd •Lassi •Unpacked Foodgrains •Unpacked Paneer •Gur •Educations Services •Kajal •Children’s Drawing & Colouring Books •Unbranded Natural Honey •Prasad •Besan •Unbranded Maida •Unbranded Atta 5% •Edible Oils •Domestic LPG •PDS Kerosene •Cashew Nuts •Milk Food for Babies •Coir Mats, Matting & Floor Covering •Fabric •Spices •Coal •Roasted Coffee Beans •Apparels (< Rs.1000) •Footwear (< Rs.500) •Skimmed Milk Powder •Life-saving drugs •Coffee (except instant) •Mishti/Mithai (Indian Sweets) •Agarbatti
  • 11. Tax Rates Products 12% •Butter •Ghee •Almonds •Umbrella •of Plants including Pickle Murabba, Chutney, Jam, Jelly •Preparations of Vegetables, Fruits, Nuts or other parts •Fruit Juice •Mobiles •Processed •food •Computers •Packed Coconut Water 18% •Hair Oil •Toothpaste •Soap •Pasta •Corn Flakes •Soups •Printers •Computers •Toiletries •Ice-cream •Industrial Intermediaries •Capital goods 28% •Small cars (+1% or 3% cess) •Consumer durables such as AC and fridge •High-end motorcycles (+15% cess) •Beedis are NOT included here •Luxury & sin items like BMWs, cigarettes and aerated drinks (+15% cess)
  • 12. Items out from the criteria of GST  PETROL  CRUDE OIL  GAS  DIESEL  Aviation turbine fuel  Alcohol for human consumption  Electricity
  • 13.  Beneficial for small traders and service providers As per the current VAT structure, any business with a turnover of more than Rs. 5 lakh (in most states) is liable to pay VAT (different rates in different states). But After GST This Limit increased to Rs. 20 lakhs . So many small traders and service providers will be exempt from GST. Simpler online procedure under GST The entire GST process – starting from registration to filing returns and payment of GST tax – is online. So we do not have to run around to tax offices to get various registrations under excise, VAT, service tax. Advantage of GST
  • 14.  Lesser number of compliances GST unified all different types of Tax procedures, thereby reducing the number of returns and the time spent for tax compliances . There are 4 are basic returns ,which apply to all taxable persons under GST.  Composition scheme for small businesses GST also has an optional scheme of lower taxes for small businesses with turnover between Rs. 20 to 50 lakhs. It is called the composition scheme. It has now been proposed to be increased to 75 lakhs. This will bring respite from tax burdens to many small businesses.  Defined treatment for e-commerce Many Indian businesses provide goods and services through the internet. Earlier, there were no specific provisions for treatment of the e-commerce sector. Currently, states have variable VAT laws for this sector. All these differential treatments and confusing compliances will be removed under GST.
  • 15.  Regulating the unorganized sector Certain industries in India like construction and textile are largely unregulated and unorganized. GST has provisions for online compliances and payments, and availing of input credit only when the supplier has accepted the amount, thereby bringing accountability and regulation to these industries.  No hidden taxes GST will not be a cost to registered retailers .So there will be no hidden taxes and and the cost of doing business . transparency GST will also help to build a transparent and corruption free tax administration.
  • 16.  Removing cascading tax effect An important benefit of the introduction of GST will be the removal of the cascading tax effect. In simple words, “cascading tax effect” means a tax on tax. For Example - A trader buys A Product for Rs. 20,000 paying 5% (Rs. 1,000) as tax. 15% service tax on services of Rs. 50,000. Currently, he has to pay Rs. 50,000*15% = Rs. 7,500 without getting any deduction of Rs. 1,000 VAT already paid on above Product.
  • 17. Under GST (assuming GST= 18%) GST on service of Rs. 50,000 @18% 9,000 Less: GST on Product (20,000*18%) 3,600 Net GST to pay 5,400
  • 18. Disadvantage of GST  Increase in Operating Costs Most small businessman in India has traditionally preferred to pay taxes and file returns on their own to save costs. But GST is completely new system. So that the small businesses will have to bear the additional cost of hiring experts.  Higher Tax Burden for Manufacturing SMEs Under the excise laws, only manufacturing business with a turnover exceeding Rs. 1.50 crores had to pay excise duty. But under GST the turnover limit has been reduced to Rs. 20 lakh, thus increasing the tax burden for many manufacturing SMEs.  Sometimes dual Taxation GST is being referred as a single taxation system but in reality it is a dual tax in which state and centre both collects separate tax on a single transaction of sale and service.
  • 19.  Online Procedure GST compliance, return filing and payments all have to be done online. Many small businesses are not tech-savvy and do not have the resources for fully computerized Tax System.  Costlier Service – Before GST system Service Tax rate was 15% ,but now it will increase to 18%-20% after GST. As such many services will be costlier. telecom, airline and banking services will majorly affected by GST.  Registration in the Many States Required–As per GST, the seller would require registering in all the states that it does business in and that would increase the complexity for the seller.
  • 20.  Disability Tax – Opposition has called it as a Disability Tax as many of the things related to disabled people which were earlier Tax-Free are now included in GST Taxation. Prior to implementation of GST, brail paper, typewriter, hearing aid and motorized wheelchair were tax-free whereas these things are being taxed now.  overhead expenses - businesses will need to train their employees in GST compliance. this will also increase their overhead expenses.  minimal exemption list - GST is not good news for all sectors, though. In the previous system, many products are exempted from taxation. The GST proposes to have minimal exemption list.
  • 21. GST : Impact On GDP  In a report issued by the Finance Ministry, it was mentioned that Make In India program will be more benefited by the GST structure due to the availability of “input tax credit” on capital goods.  GST would be the key revolution in Indian Economy and it could increase the GDP by 0.9 to 1.7 percent. GST Positive Impact On GDP
  • 22. GST Negative Impact on GDP  As we know Real Estate also plays an important role in Indian economy but some expert thinks that GST will impact the Real Estate business negatively .it will add up the additional 8 to 10 percent to the cost and reduce the demand about 12 percent.  As the GST rates are 5%, 12%, 18% and 28% and if the GST rate on service will be finalized at 5% or 12% then cost of services will get reduced while in else case if the rate will be 18% or 28% on services then services will become costlier and it will lead to inflation for a short period.  In a report, DBS bank noted that initially GST will lead to rise in inflation rate which will remain for a year but after that GST will affect positively on the economy.
  • 23. CONCLUSION As every coin has two faces in the same way we tried here to familiarize the things related to GST with both perspective i.e. positively and negatively . Despite having some factor which is being expected to affect the Economy adversely ,there are so many other things which are expected with a positive impact on GDP.
  • 24. References  DISADVANTAGE Of GST http://www.gstindia.com/gst-with-examples/ http://www.worldblaze.in/advantages-and- disadvantages-of-  GST Rates https://cleartax.in/s/gst-rates  Why GST is Important in India http://www.businessalligators.com/gst-impact-rates- type- P.T.O
  • 25.  Items out from the criteria of GST http://howtoexportimport.com/3-commodities-not- fall-under- GST-in-India-4272.aspx  Impact on GDP http://blog.saginfotech.com/gst-impact-on-gdp-india  GST registration https://cleartax.in/s/gst-registration

Editor's Notes

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