Applicability & Features
Draft bill for the Goods and Services Tax presented in
Parliament on 19th Dec.2014 with a view to implement the GST from 1st
April 2016 (F.Y.2016-17).
PAN based Tax Payer
Identification Number (13 or 15 digits) will be allotted to all the RC holders.
GST would be a Destination
Based Tax as against the present concept of Origin Based Tax.
GST would be applicable to
all supply of goods and services except alcoholic liquor for human consumption.
Petroleum products also may be out of GST for an initial period of 2-3 years
from Yr.2016.
Tax Structure & Rates
Both the Central Govt. and
State Govt. will simultaneously charge GST during the value chain of
Transactions.
The GST may have following components:
1) Central Goods &
Services Tax (CGST) which is being levied by
Central Govt. on all transactions happening within the State. (Central Excise
duty, Addl. Duties of Excise, Customs, Service Tax, Cess, Surcharge etc.
will be replaced with CGST).
2) State Goods &
Services Tax (SGST) which is being levied by the State
Govt. on all transactions happening within the State. (VAT, CST, Entry Tax,
Luxury tax, Entertainment tax, Cess, Surcharge etc. will be replaced with
SGST).
3) Integrated Goods &
Service Tax (IGST) which is being levied by the Central
Govt. on Interstate Supply of Goods & Services.
4) Addl. IGST on Interstate Trade
or Commerce which is being levied by the State Govt.
The Tax rates for CGST, SGST, and IGST
is not yet declared. But the revenue nuetral may not be less than 27%. But the Addl. IGST may not be more than 1% as it is a Non
Vatable tax.
Input / Output Tax Liability
- CGST & SGST will be charged on all transactions
within the State.
- IGST and Addl. IGST will be charged on all Inter State
Transactions.
- As per the available information, there may be an Addl.
IGST levy on Stock Transfers from one State to another.
- Exports will not have any tax liabilities.
- Import of Goods & Services will be treated as
Inter-State supplies and so IGST will be levied in addition to the applicable
customs duties.
Input Tax Utilization
- Credit of CGST paid on inputs may be used only for
paying CGST on the output.
- Credit of SGST paid on inputs may be used only for
paying SGST on the output.