Goods and Services Tax: Frequently Asked Questions
The GST is a single indirect tax for the whole nation, which will make India one unified common market. It is a single tax on the supply of goods and services, right from the manufacturer to the consumer.
Credits of input taxes paid at each stage will be available in the subsequent stage of value addition, which makes GST essentially a tax only on value addition at each stage. The final consumer will thus bear only the GST charged by the last dealer in the supply chain, with set-off benefits at all the previous stages. [Special Coverage on GST Bill]
1. What are the benefits of GST?
The benefits of GST can be summarised as under:
-- For business and industry:
** Easy compliance
** Uniformity of tax rates and structures
** Removal of cascading
** Improved competitiveness
** Gain to manufacturers and exporters
-- For central and state governments:
** Simple and easy to administer
** Better controls on leakage
**
Higher
revenue
efficiency
--
For
the
consumer:
** Single and transparent tax proportionate to the value of goods and services
** Relief in overall tax burden
2. Which taxes at the Centre and state level are being subsumed into GST?
At the Central level:
Central
excise
duty,
additional
excise
duty,
service
tax,
additional
customs
duty
(commonly
known
as
countervailing
duty)
and
special
additional
duty
of
customs.
At
the
State
level:
Subsuming of state value added tax/sales tax, entertainment tax (other than the tax levied by the local bodies), central sales tax (levied by the Centre and collected by the states), octroi and entry tax, purchase tax, luxury tax, and taxes on lottery, betting and gambling.
3. How will GST be levied?
The Central GST (CGST) and the State GST (SGST) would be levied simultaneously on every transaction of supply of goods and services except on exempted goods and services, goods which are outside the purview of GST and the transactions which are below the prescribed threshold limits.
Further,
both
would
be
levied
on
the
same
price
or
value
unlike
state
value
added
tax,
which
is
levied
on
the
value
of
the
goods
inclusive
of
central
excise.
4.
How
will
imports
be
taxed
under
GST?
The
Additional
Duty
of
Excise
and
the
Special
Additional
Duty
presently
being
levied
on
imports
will
be
subsumed
under
GST.
Unlike
in
the
present
regime,
the
states
where
imported
goods
are
consumed
will
now
gain
their
share
from
this
Integrated
GST
paid
on
imported
goods.
IANS