GST stands for

INTRODUCTION

GST stands for Goods and Services Tax. Unlike present system GST is supposed to take care of the taxes being charged under various indirect taxation laws presently in existence. The aim of GST is to cover the journey of a transaction from its inception to the end. The tying of these two ends will help the tax authorities to ensure that there is no leakage of taxes in between which may cause loss of revenue to the Government. Being single major taxation platform GST is supposed to bring more transparency, efficiency and plug loopholes under present system of indirect taxation.
GST aims to simplify the indirect tax structure. Presently we have two sets of indirect taxes first one being implemented by the Central Government authorities and the second one by state authorities. There are many departments dealing with various central and state taxes. Most of such taxes will be subsumed in one sea i.e. GST.

AIM OF GST

By bring majority of indirect taxes under one department will lead to more transparency, less wastage of time and cost as in future businessmen/service providing community will be required to interact through GST Portal and if need be, follow up with a single department for all sorts of problems.
By subsuming majority of existing indirect taxes, it will do away with the cascading effect of taxes in future. This is expected to bring down the prices of products by around 2% to 15%. Cascading effect of taxes means paying tax on tax.
GST will convert the whole nation into single market with identical tax rates applicable on various goods and services. It will end the multi system of taxation rates for the same goods or services existing at present which varies from state to state.
Another major shift from the present system of indirect taxes is that GST will be consumption based tax system. By consumption based tax we mean to say that in future the taxes charged under GST will become the revenue of the state where the goods or services are consumed. Thus, the taxes will be recovered from the actual consumer and up to that point registered dealers can claim input credit of taxes.

DILIP K RAINA –Chartered Accountant:

B.Com; FCA (ICAI); PGDFM; PGDCA; DBM; Cert. IFRS (ICAEW); NCFM Capital Market (Dealers Module); Microsoft Certified IT Professional: Application for Microsoft Dynamics NAV (ERP) & AXAPTA (ERP)

Post a comment or leave a trackback: Trackback URL.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: