Goods and Services Tax (GST) is a destination-based indirect tax, which has based on goods and services. Good and Services Tax include many Central and State taxes, such as VAT, excise duty, and service tax. The GST Act has been in the act from 1 July 2017. It has is based on comprehensive, multi-stage, destination-based Tax. It is a domestic indirect tax law for the entire country.
There are two types of central GST and State GST, which everyone has to pay for every good you buy anywhere in India. For example, if someone buys a good in Rajasthan, but the product has manufactured in Maharastra. The Tax will directly go to the Rajasthan government instead of the Maharashtrian government.
The Journey of GST in India
- The goods and services tax came to India in mid-2000. Goods and services tax refurbished itself till 2017 and emerged to act.
- The global services tax started resolving in 2010 prime minister set up a committee to start and draught the GST law.
- In 2004 a task force was inspired against the GST that it should get used in India for their current tax structure.
- In 2006 finance minister was approved, and then he proposed the GST introduction from 1 April.
- In 2007 GST was improvised and was reduced from 4% to 3%.
- In 2008 the committee ensured a proper structure for GST and distributed it to legislation.
- In 2010 a project was computerized, and the GST structure postponed.
- In 2011 the Constitution amendment Bill improved the GST.
- In 2012 the committee began and discussed on GST and stalled over the clause of 2798.
- In 2013 standing committee reports the GST to the higher authorities.
- In 2014 the bill was taken to parliament house and was introduced to the finance minister.
- In 2015 the GST bill fast in Lok Sabha, but Rajya Sabha did not pass it.
- In 2016 GST came to act.
- In 2016 the new model was launched and was passed by both the houses. President of India also gives a clean chit to GST.
- In 2017 four supplements were divide from GST and were approved by the cabinet.
- The final implementations were done on 1 July 2017, by Rajya Sabha.
- GST was launched on 1 July 2017 and came to act from them.
Advantages Of GST
- GST advantage to many and has many purposes behind it. The goods and services tax has also mentioned removing the cascading effect of Tax, which was on higher and lower classes.
- The higher threshold of GST registration made it clear and very advantageous to every people.
- It also has a composition scheme for every small business to a large one, which is beneficial to people who are thinking of setting up a small business but are worried about taxes don’t have to pay that much due to their composition scheme. GST also facilitates online services, which means you can go online portal facility for every kind of services related to goods and services tax. It has very lesser compliances under the GST act against the normal one.
- GST is easier to understand to the public and the less educated public as well. It also comes with special e-commerce services and activities, advantages for the development of the Indian social market. They also increased efficiency and logistics, which means the Indian functions will work fast and more accurate. It also has a statement under regulating the untouched sectors. The development will boost up through GST.
The components of GST
- There are three taxes applicable under this system: CGST, SGST & IGST. The CGST is a tax collected by the Central government on interest rate sales, for example, a transition happening within Maharashtra.
- Gst also helped every class of this society and helped us in every aspect. It removed the cascading effect of taxes in many ways.
DISADVANTAGES OF GST
- There are many disadvantages of GST as well, such as GST has increased cost of software purchase, and others as well, which affect the businessmen.
- GST has impacted transaction fee and insurance fee as well, which is a burden for some people.
- GST also short-term the trend of the leading estate prices, but they increase the estate costs from 8% to 12%. Petrol pumps are not under global service tax, which is against the idea of unification and ideal of unification of communities as well.