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14 Quick Facts About Goods & Service Tax: Your Comprehensive Guide

Quick Facts about GST

 

So, one morning while sipping in your morning tea and going through your usual routine of reading the newspaper, you come across yet another news on GST for the umpteenth number of time.
“GST Roll Out: A Historic Moment For for The Developing India
It’s complicated, it’s deep. You decide to ignore it yet again because no matter how hard you try, you fail to catch the head or tail of this new tax regime. But then finally, when the your entire circle of friends and colleagues are pouring out their opinion on why GST should be shown a green flag, disadvantages of GST, Input Tax Credit and so forth, you feel uneasy and discomforted because you cannot participate in this ‘intelligent conversation.’
Sounds familiar?
Well, how about being served with just as much rather than a platter full of never ending details. Take this comprehensive guide on GST and slay the conversations in style:

1. What Is GST?
GST is one indirect tax for the whole nation, which will make India one unified common market. GST is a single tax on the supply of goods and services, right from the manufacturer to the consumer.

2. GST: A Tax on Supply
GST shall incur on sale, manufacture, import or provision of services. Therefore, taxable event for GST would be supply of goods and services.
Supply: Sale, Barter, Exchange, Transfer, Rental, lease, license, disposal.

3. GST was conceptualised 17 years back
Well, the history of GST dates back to 2000 when it was conceptualised by Vajpayee Government setting up empowered committees.

4. GST Is Implemented in 160+ Countries
Yes! You read it right. This brilliant GST regime is not so novel as around 160 countries across the globe have already been following the idea, France being the first country to introduce it.

5. Dual GST Structure
India will have dual GST structure: Central GST and State with Centre and State having concurrent powers to make laws on goods and services.
Also Read:  A Guide To GST & Its Types

6. Rate of GST
Four tier rate slab is introduced in GST Model Law in India. They are 12% and 18%, a lower rate of 5% for the essentials and a higher rate of 28% for the luxury goods. The global standard rate of GST varies from 1.5% to 27 respectively in Aruba and Hungary.

7. Composition of GST Council
The GST council consists of:
i. The Union Finance Minister as Chairman
ii. the Union Minister of State in charge of Revenue or Finance
iii. the Minister in charge of Finance or Taxation or any other, nominated by each state government.

8. GST Invoice
i. All GST taxpayers are free to design their own tax invoice format.
ii. Small taxpayers doing conducting a large number of transactions up to Rs. 200/ transaction to unregistered customers need not issue invoice for every transaction but one consolidated invoice at the end of the day.
iii. For a hassle-free compliance, taxpayers with turnover up to 1.5 crore need not mention HSN (Harmonised System Of Nomenclature) Code of goods in the invoice.
iv. For non taxable supplies, if the VAT invoice is issued, there is no need of separate bill of supply.

9. Supply of Goods to Attract Additional Tax
For inter-state trade, an additional tax, not exceeding 1%, on supply of goods shall be levied and collected by the centre.

10. Disposal of Assets Shall Attract GST
According to Schedule I, GST shall be levied on disposal of assets (even without consideration) on which credit has been availed.

11. Alcoholic Liquor Kept Out of GST Scope
State excise duties and VAT shall be applicable as before on alcoholic liquor for human consumption.
A few petroleum products have also been kept out of the scope of GST.

12. Compensation to States
For the loss on implementation of GST, State shall be compensated by the Parliament on GST Council’s recommendation up to a period of 5 years.

13. Restriction on Imposition of Tax
Constitution imposes restriction on imposition of taxes on sale or purchase of goods as the supply of goods and services are taxed instead.

14. GST Dispute Redressal Mechanism
Various ways of Dispute Redressal Mechansim are:

i. Judicial Dispute Resolution mechanism;
ii. GST Dispute Settlement Authority
iii. Extra Judicial Dispute Resolution;
iv. Online Dispute resolution.

Now that you have enough to GST information, we hope you are all set to jump into witty conversations!

 

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