Saturday, 1 July 2017

GST is Live Now!!!

GST-is-Live-Now-!!

Folks, tonight is a memorable one as we all know that GST i.e Goods & Services Tax is about to rollout very soon. This is a journey of 13 years since it was first discussed in the report of Kelkar Task force on indirect taxes. So it's quite obvious that as Indians it's a moment for us to be proud as we got the chance to witness the complete revamp of our Taxation regime. The previously prevailing taxation system of India was commodious for the business & service class. That had impacted or should we say that it demotivated budding industries & foreign big players from entering into the Indian markets in a negative manner. As these foreign players were not used to such cumbersome tax regime, they found it difficult to setup industries here in India thereby impacting India's rankings in the Ease of doing business reports.
In August 2016, the parliament approved the landmark legislation of Goods & Services Tax to reduce the complexity of the existing tax structure which consisted of scattered taxes which have multitudes of classification. The drawback of previous tax structure was that at each point of sale another tax was levied over the existing on-tax value of any goods & services. So, the main aim of GST is to eliminate this compounding effect by fixing the final tax rate, where goods will fall into one of four rate categories of 5, 12, 18, and 28 percent. The GST will merge the indirect central & state taxes into a four-tier schedule.


While necessity goods will be taxed at 5 percent and luxury and consumer durable goods at 28 percent, most goods and all services will be taxed at the standard rates of either 12 or 18 percent, but the allocation is yet to be allocated. While justifying this four-slab tax structure, FM Mr. Arun Jaitley said, " A BMW car can't be taxed in the same way as a hawai chappal (sleepers)." 

At the Central level, the following taxes are being subsumed:
a. Central Excise Duty,
b. Additional Excise Duty,
c. Service Tax,
d. Additional Customs Duty commonly known as Countervailing
Duty, and
e. Special Additional Duty of Customs.

whereas at the state level 

a. Subsuming of State Value Added Tax/Sales Tax,
b. Entertainment Tax (other than the tax levied by the local bodies),
Central Sales Tax (levied by the Centre and collected by the
States),
c. Octroi and Entry tax,
d. Purchase Tax
e. Luxury tax, and
f. Taxes on lottery, betting and gambling are being subsumed.

Keeping in mind the federal structure of India, there will be two components of GST – Central GST (CGST) and State GST (SGST). Both Centre and States will simultaneously levy GST across the value chain. Tax will be levied on every supply of goods and services. For the implementation of GST effectively, a GST network named organization will act as an IT infrastructure & provide services. So, there would no manual filing of returns. All taxes can also be paid online.

Effects on commodities-

What will be expensive:

1- Eating Out
2- Phone Bills
3- Jewellery
4- Online Shipping
5- Banking & Insurance
6- Travelling

What will be cheaper:

1- Buying a car.
2- TV sets
3- Movie Tickets
4- Processed Foods
5- Cement

So, from this midnight we would witness a new era of Indian Tax Regime. Let's hope that this would benefit our economy in an unprecedented manner. Thank You !!!

      


CRACK IBPS PO 2017



11000+ (RRB, Clerk, PO) Candidates were selected in IBPS PO 2016 from Career Power Classroom Programs.


9 out of every 10 candidates selected in IBPS PO last year opted for Adda247 Online Test Series.

No comments:

Post a Comment