GST Meaning GST is an indirect tax to

GST - Meaning GST is an indirect tax to replace taxes levied by the central and state governments. It is governed by GST Council, headed by the Union Finance Minister of India, Arun Jaitley GST is a Consumption based tax on goods and services but not on Units Manufactured

History of GST - 2017 • The reform process in indirect tax in India was started in 1986 by V P Singh by introduction of Modified Value Added Tax (MODVAT) • It is introduced as The Constitution Act 2017, following the passage of Constitution 122 nd Amendment Bill • A 21 -members select committee was formed to look into the proposed GST law

Why GST - 2017 • The current system with no GST implies that tax is paid on the value of goods and margin at every stage of the production process. • This would translate to a higher amount of total taxes paid, which is carried down to the end consumer in the form of higher costs for goods and services. • Implementing the GST system in India is therefore, a measure that will be used to reduce inflation in the long run, as prices for goods will be lower.

Different Tax Rates of GST • 0% - milk, butter milk, curd, natural honey, fresh fruits and vegetables, flour, besan, bread, prasad, salt, stamps, judicial papers, printed books, newspapers, bangles, handloom • 5% - packaged food items, milk powder, branded paneer, Coffee, tea, spices, pizza, bread, rusk, Transport Services - (Railways, air transport) Small restaurants

Different Tax Rates of GST (Contd) • 12% - butter, cheese, ghee, dry fruits in packaged form, animal Fat, Namkeen, Ayurvedic medicines, tooth powder, agarbatti, Colouring books, Drawing books, etc. , Flavoured refined sugar, pasta, cornflakes, pastries and Cakes, preserved vegetables, jams, sauces, soups, ice cream, instant food mixes, mineral water, AC hotels that serve liquor. telecom services, IT services, branded garments. Etc. , • 18% -

Different Tax Rates of GST (Contd) • 28% - Bidis, chewing gum, molasses, chocolate not containing Cocoa, waffles and wafers coated with choclate, pan masala. • Special rate of 0. 25% on rough and semiprecious stones and • 3% on gold

Taxes will be bound together by the GST Central Excise Duty Entertainment Tax Luxury Tax Food Tax Entry Tax Commercial Tax Advertisement tax Octroi Purchase Tax Value Added Tax (VAT) Central Sales Tax (CST)

Important Points on GST • France was the first country to implement the GST in 1954, and since then an estimated 160 countries have adopted this tax system. • Some of the countries with GST include Canada, Vietnam, Australia, Singapore, UK, Spain, Italy, Nigeria, Brazil, and South Korea.

Objections or Challenges of GST • In the Name of TDS, most of the Salaried people and formerly employed paying Tax for their income at the source itself. So they need to pay twice while purchasing goods and availing services. • Again there are different types GST, like CGST, SGST, etc. , - Why? • Tax Burden of Ordinary People not reduced?

Objections or Challenges of GST • No Tax on Manufacturing Process? So who will be the real beneficiary!. . . • There will be no GST on the sale and purchase of securities. Who trades and Invest in Securities? • Why we can introduce charging Direct Tax alone at very low rate to abolish all the Indirect Taxes like Sales Tax, Octroi, GST, etc. ,

Thank you and Bye Dr. A. MOHANASUNDARAM. Dean – Commerce Studies, SNMV College of Arts and Science. Coimbatore – 641 050.