Gst Enablement in India

GOODS & SERVICE TAX (GST) Presented By : inoday

inoday Consultancy Services (P) Ltd.

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One Country One Tax One Market ■ GST is one indirect tax for the whole nation, which will make India one unified common market.

■ Goods and Services Tax (GST) would be a significant step in the reform of indirect taxation in India ■ Goods and Services Tax would be levied and collected at each stage of sale or purchase of goods or services based on the input tax credit method.

■ Keeping in mind the federal structure of India, there will be two components of GST – Central GST (CGST) and State GST (SGST).

inoday Consultancy Services (P) Ltd.

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KEY CONCEPTS TO CHANGE ■

Taxable event changed from ‘manufacture’/ ‘sale’/ ‘provision of services’ to ‘supply’

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Uniform across States

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GST to subsume majority of indirect taxes

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Likely to be consistent for all goods and services

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Rates to change, exemptions to be withdrawn/ pruned or converted to refund schemes

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Destination based rules

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No differentiation between goods and services for credit availment

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Trader, Manufacturer and Service provider will be at par in terms of claiming credit

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Credit pool to be maintained State-wise

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TAX STRUCTURE Taxes to be subsumed

Central Taxes

State Taxes

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Additional duty of customs

• Value Added Tax (‘VAT’)

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Special additional duty of customs

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Central excise duty

• Other State taxes such as Luxury tax, octroi, entry tax, purchase tax, etc.

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Service tax

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Central Sales Tax (‘CST’)

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Surcharge and cess related to supply of goods and services

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Medicinal and toilet preparations (Excise duties) Act, 1955

• Surcharge and cess related to royalties and supply of goods • Taxes on lottery, betting and gambling

Taxes outside the purview of GST •

Basic customs duty

• State excise duties

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Stamp duty

• Taxes and duties on electricity

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Taxes and duties on alcohol for human consumption

• Additional duties on tobacco and tobacco products*

Taxes and duties on petroleum products may be included within GST from a notified date inoday Consultancy Services (P) Ltd.

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RATE STRUCTURE Rate structure at 0%, 5%, 12%, 18% and 28% Particulars

Rate

Exemption

0%

Fruits, vegetables, essential items/medicines

Lower rate (mass consumption items)

5%

Edible oil, spices, tea, coffee

Standard Rate

12%/18%

Higher rate (demerit goods)

28% cess levied

Applicable on all other goods, services to be taxed at 18% White goods e.g. LED TV sets

• Services may also be subject to lower tax rates as per slabs mentioned above, such as goods transport agency services • Cess on demerit goods such as luxury goods, etc., to be reviewed annually and to be phased out in 5 years

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CREDIT MECHANISM Credit Type

Paid On

Applicable Credit

CGST

• Local supply of goods/ services

• CGST • IGST

• Local supply of goods/ services

• SGST • IGST

• Inter-State supply of goods/ services

• IGST • CGST • SGST

SGST

IGST • Imports* into India of goods/ services

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inoday Consultancy Services (P) Ltd.

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