ALL ABOUT GST
ALL ABOUT GST
MEANING:
GST is known as Goods andServices Tax which was introduced on 29th March 2017 by the Parliament and came into effect from 1st July 2017. In India GST is considered as a “Reform” rather than an amendment which was passed to suppress the cons and negative impacts in indirect taxation system. It is destination based tax and levied on supply of goods and service and thus considered as a comprehensive tax on every value. GST is imposed on the spot of sale. In the case of intra state sale, it is carried out by Central GST and State GST. It is present from very first stage of purchasing raw materials to the making of end product, it revolves around each stage of making a product and thus it is called as a multi – stage task. It deals with one nation one tax.
ADVANTAGES OF GST:
1. GST removes cascading effect which is implied on the cost of goods and thus reduces application of tax on tax as before.
2. Creation of common national market .
3. Reduced transaction costs through simplified online process for tax compliance.
4. Composition for small businesses .
5. Exemption limit has been increased for small traders.
6. An unorganized sector gets regulated.
7. Uniform tax structure.
8. Documentation maintenance on electronic basis .
9. Cost of consumer reduced.
10. Tax on all inputs are eligible for credit.
11. Elimination of multiplicity of tax.
COMPLIANCES OF GST:
1. Online filing of GST returns
2. GST introduced E- Way Bills on 1st April 2018 for interstate transactions of goods and from 15th April 2018 for intra state transactions of goods and services. Here E- way bills is initiated for goods transacted from one place to another on a common portal and thus reduces time at check posts and tax evasion
3. Invoicing launched on January 2020 for large business with an average aggregate turnover of more than hundred crore rupees they must obtain a unique invoice number for uploading in GSTN’s portal to verify correctness of the invoice. It uses digital signature with QR code and eliminates the manual data entry work.
REGISTRATION OF GST:
GST registration where businesses have turnover exceeding Rs.40 lakh is subject to be a normal taxable person and any organization carries on business without registration under GST, it will lead to an offense with higher penalty.
Documents required registering under GST:
1. Pan of applicant
2. Aadhar card
3. Address proof of place of business
4. Bank account statement
5. Digital signature
6. Letter of authorization identity and
7. Address proof of promoters and directors with photographs
8. Incorporation certificate
A person not paying tax or making short payments by genuine errors is subject to pay a penalty of 10% of tax amount
which is subject to minimum amount of Rs. 10,000.
If a person not paid GST because of deliberate intention for tax evasion then it is subject to pay off 100% of tax amount.
COMPONENTS OF GST:
There are three components in GST. They are:
1. CGST
– Tax collected by central government on an intra state sale. Example: sale of goods and services within Tamil Nadu ( a particular state)
2. SGST
– Tax collected by state government on an intra state sale.
3. IGST
– Tax collected by central government on an interstate sale. Example: sale of goods or services between Tamil Nadu and Kerala.
The sale within state, where CGST and SGST apply and revenue will be shared equally between the centre and the state.
The sale to another state, where IGST applies and revenue will be shared by the central government to the IGST based on the destination of goods.
CONCLUSION:
GST brings transparency and
easy tax payment facility with no corruption unlike in the previous indirect tax system. It makes a way to better level of trade in international forums. GST implies on the sale of goods and services and thus provides compliance even in small market enterprises and unorganized sectors. GST helps in making our nation stable and competent with foreign countries.
BY- R. SRUTHI
BCom.LL.B (III YEAR)
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