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Goods and Services Tax

Goods and Services Tax

Goods and Service Tax (GST)

The Goods and Service Tax Act introduced on 1st July 2017 is the single biggest tax reform in the independent India to ease compliance and also to boost the ease of doing business.

It replaces and subsumes all indirect taxes and creates a one nation one tax market. Effective 1st July 2017, the following indirect taxes are subsumed into GST:

1. Central sales tax (CST)

2. Central VAT (CENVAT)

3. State VAT (VAT)

4. Service tax (ST)

5. Octroi/ Entry tax

6. Lottery tax

7. Special additional duty of customs

8. Additional excise duty

9. Countervailing duty

10. Entertainment tax

11. Central excise duty

12. Purchase tax

Advantages of the introduction of GST can broadly be summarized as under:

To Citizens:

Simpler tax system

Reduction in prices of goods and services due to elimination of cascading

Uniform prices throughout the country

Transparency in taxation system

Increase in employment opportunities

Trade/Industry:

Reduction in multiplicity of taxes

Mitigation of cascading/double taxation

More efficient neutralization of taxes especially for exports

Development of common national market

Simpler tax regime-fewer rates and exemptions

GST Resources