this ppt is essentially helpful for beginners for a better understanding of the gst and also many legal and constitutional framework has been added so that u can also overview the law related matters in it.
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Goods and service tax made easy
1. GOODS AND SERVICE TAX(GST)
A SIGNIFICANT REFORM IN INDIRECT
TAX LEGISLATION HISTORY OF INDIA
2. CONTENTS
1. INTRODUCTION
2. TEN THINGS YOU SHOULD KNOW ABOUT GST
3. ECONOMIC ANALYSIS OF
GST(PROPORTIONAL TAX)
4. POLITICS ON GST
5. CONSTITUTIONAL ASPECTS
3. Economic analysis of GST
• FOR A DEVELOPING NATION LIKE INDIA, A
PROPORTIONAL TAX SYSTEM IN RECOVERY PERIOD
IN GLOBAL ECONOMY ADDS FUEL TO THE ENGINE OF
ECONOMIC GROWTH THERBY STABILISING THE
COUNTRY ECONOMY.
• GST IS A CONSUMPTION BASED PROPORTIONAL TAX.
• GST REMOVES THE HINDRANCES IN PREVIOUS
TAXES.
• A SIMPLIFIED PROCEDURAL ASPECTS ATTRACTS GST
IN NOT ONLY BUSINES HOUSES BUT ALSO COUNTRY
AT A LARGE.
5. HINDRANCES IN PREVIOUS TAXES
• 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.
• Broadening of Tax base.
• Improved compliance & revenue collections (tax
booster)
9. CONSTITUTIONAL ASPECTS
• The Goods and Services Tax Bill or GST Bill, officially
known as The Constitution (One Hundred and
Twenty-Second Amendment) Bill, 2014, proposes a
national Value added Tax to be implemented
in India from April 2016.
• Which sub includes amendments to :
1. ARTICLE 248 8. ARTICLE 279
2. ARTICLE 249 9. ARTICLE 286
3. ARTICLE 250 10. ARTICLE 366
4. ARTICLE 268 11. ARTICLE 368
5. ARTICLE 268A
6. ARTICLE 269
7. ARTICLE 271
10. CONSTITIUTIONAL ASPECTS
• UNION LIST - ENTRY 92 AND 92C SHALL BE OMITTED.
• STATE LIST – ENTRY 52 AND 55 SHALL BE OMITTED.
• STATE LIST – ENTRY 54 ANDAND 62 SHALL BE
SUBSTITUTED.
• UNION LIST – ENTRY 84 SHALL BE SUBSTITUTED
• Article 279(5) – Goods and Service Tax council shall
be established.
11. INTRODUCTION
• GST is a consumption based proportional tax.
• It is world wide popularly known as VAT.
• In principle, GST should not differentiate between
goods and services.
• Internationally, GST was first introduced in France
and now more than 150 countries have introduced
GST.
• Most of the countries, depending on their own socio-
economic formation, have introduced National level
GST or Dual GST.
12. INTRODUCTION - 2
• A transaction in goods and services for a
consideration would attract CGST and SGST.
• Also, the State Government now gets the power to
tax services and Central Government gets the power
to levy tax at the distribution and retail level.
• GST may resolve, not all, but surely, most of the
current issues such as the classification, valuation,
double taxation disputes etc.
• The compliances are also expected to reduce
drastically.
13. What will be out of GST?
• Levies on petroleum products
• Levies on alcoholic products
• Taxes on lottery and betting
• Basic customs duty and safeguard duties on import
of goods into India
• Entry taxes levied by municipalities or panchayats
• Entertainment and Luxury taxes
• Electricity duties/ taxes
• Stamp duties on immovable properties
• Taxes on vehicles
14. Ten things you should know about GST
1. GST applicable on supply.
2. GST payable as per time of supply
3. Determining Place of Supply could be the
key
4. Valuation in GST
5. Input tax credit in GST
6. Inter-State supply of goods for consideration
to attract additional tax
15. Ten things you should know about GST
7. There would be 33 GST laws in India
8. Rate of GST is not yet specified in the draft
GST law
9. Time limit for show cause notices (SCN)
10. Old provisions re-introduced
Like composition scheme in VAT, reverse charge
in service tax fines and penalties, etc.
16. GST IN INDIA
• India is proposing to implement dual GST. In dual GST
regime, all the transactions of goods and services
made for a consideration would attract two levies i.e.
CGST (Central GST) and SGST (State GST).
• Administration: CGST and IGST will be administered
by Central Government‘ and SGST will administered
by the respective State Governments.
• Law relating to GST: In GST regime, there will be
one CGST law and 31 SGST law for each of the States
including two Union Territories and one IGST law
governing inter-State supplies of goods and services.
17. GST IN INDIA
Taxes that will be subsumed in GST:
At Central level
• Central Excise Duty (including Additional Duties of Excise)
• Service Tax
• CVD (levied on imports in lieu of Excise duty)
• SACD (levied on imports in lieu of VAT)
• Central Sales Tax
• Excise Duty levied on Medicinal and Toiletries
preparations,
• Surcharges and cesses
18. GST IN INDIA
At State level
• VAT/Sales tax
• Entertainment tax (local bodies)
• Luxury Tax
• Taxes on lottery, betting and gambling
• Entry tax not in lieu of Octroi
• Cesses and Surcharges
19. GST IN INDIA
• However, certain items / sectors would be outside
the GST regime.
• Products such as alcohol, petroleum products would
remain outside GST regime.
• Further, Land and properties may remain outside
since they are neither goods nor services.
20. GST applicable on supply
• In GST regime, all supply such as sale, transfer,
barter, lease, import of services etc of goods and/ or
services made for a consideration will attract CGST
(to be levied by Centre) and SGST (to be levied by
State).
• Interestingly, even a barter of goods transaction
which were hitherto un-taxed in VAT regime, will
attract GST.
• Self supply of goods and services etc also attract GST.
21. GST payable as per time of supply
• The liability to pay CGST / SGST will arise at the time
of supply as determined for goods and services.
• GST at the earliest for
a. Goods‘- Removal of goods or receipt of payment or
issuance of invoice or date on which buyer shows
receipt of goods
b. Service‘s – Issuance of invoice or receipt of payment
or date on which recipient shows receipt of services.
• GST rules could be a major challenge to meet such
parameters in TIME concept.
22. Determining Place of Supply could be the
key
• Separate provisions to determine the place of supply.
Goods – place of delivery. Service – location of recipient.
• However, there are multiple scenarios such as supply of
services in relation to immovable property etc wherein
this generic principle will not be applicable and specific
rule will determine the pace of supply.
• Thus, the business will have to scroll through all the place
of supply provisions before determining the place of
supply.
23. 4. Valuation in GST
• GST would be payable on the transaction value‘.
• The law also provides for Valuation Rules to help
determine value in certain cases
• The transaction value is also said to include all
expenses in relation to sale such as packing,
commission etc. Even subsidies linked to supply will
be includable.
• discounts/ incentives given before or at the time of
supply will be permissible as deduction from
transaction value.
24. 5. Input tax credit in GST
• On lines with the United kingdom VAT law.
• CGST – INPUT TAX CREDIT
• SGST – INPUT TAX CREDIT
• IGST – CROSS UTILISATION OF TAX CREDIT BETWEEN
CGST SGST IN CASE OF INTER STATE SALE.
• Composition scheme: There would be option
available to tax payers having turnover less than Rs.
50 lacs can opt for Composition scheme wherein they
need to discharge tax at a floor rate of 1%.
25. 6. Inter-State supply of goods
• Draft GST law provides that an additional tax upto 1%
will be levied by Centre on inter-State supply of goods
(and not on services) made for consideration.
• The credit of this additional levy will not be available
as thus it will be a cost in the supply chain.
• This additional tax will be assigned to States from
where the supply of goods originates.
• This additional tax will be applicable for a period of
two years and could be extended further by GST
Council.
26. 7. There would be 33 GST laws in
India
• In GST regime, there will be one CGST law and 31
SGST law for each of the States including two Union
Territories and one IGST law governing inter-State
supplies of goods and services.
27. 8. Rate of GST is not yet specified in
the draft GST law
• The rate of GST is not specified in draft GST law.
• However, various News reports suggest that the
Revenue Neutral Rate (RNR) as proposed by the
ChieF Economic Advisor Shri. Arvind Subramanian
could be 17%-18%.
• Further, there could be lower rate (of 12%-14%) for
concessional goods and higher rate (upto 40%) for
luxury goods (such as luxury cars, tobacco products
etc).
28. 9. Time limit for show cause notices
(SCN)
• Time limit for issuance of SCN is generic cases (i.e.
other than fraud, suppression etc) would be three
years and in fraud, suppression etc cases it would be
five years.
• Its pertinent to note that the time limit prescribed
for issuance of SCN for generic cases is much more
than the current time limit prescribe in excise law
(i.e. 12 months) and service tax legislation (i.e. 18
months).
29. GST COUNCIL
• The Council shall function under the Chairmanship of
the Union Finance Minister and will have the Union
Minister of State in charge of Revenue or Finance as
member.
• Along with the Minister in-charge of Finance or
Taxation or any other Minister nominated by each
State Government.
• Revenue loss cannot be estimated unless practical
application of law is made.
30. Politics on GST
• history of GST
• EXPERTS views on gst bill
• Gst in this winter session
• Credit goes to the modi government
• Helps in increasing gdp by 2 % this year
• Foreign investors are also keen on the move
for gst bill
