Prabhakar
K S*
Before
getting in to the specific features of Indian Goods and Services Tax (GST)
Laws, it is necessary to know that in India, indirect taxes are levied by both
the Centre and the States. Indirect Taxes constitute a major source of revenue
for both the Centre and the States. Therefore, it is necessary to compensate
adequately both the Centre and the States.
The
structure of the Indian GST Laws is that of “Dual Tax” i.e. a combination of
two taxes, one of the State GST (SGST) and other of the Centre GST (CGST).
Major
Acts
The
State Goods and Services Tax Act, 2017
Salient
Features
1.
Levy of Tax:
The
State GST (SGST) and Central GST (CGST) shall be levied on all the transactions
of goods and services, concurrently.
2.
Utilization of Levy:
Levies
from State GST (SGST) & Central GST (CGST) shall form part of State and the
Centre respectively and no cross-utilization shall be allowed.
3.
Availability of Tax Credit:
In
respect of taxes paid on any supply of goods or services or both used or
intended to be used in the course business.
4.
Destination based Tax:
The
GST is a destination based tax on consumption of Goods and Services. Hence the
credit of SGST shall be transferred to the Destination State in the form of
Integrated GST (IGST). IGST will be imposed on all Inter-State Transactions.
5.
Assessment :
Registered
person will be allowed himself to assess the taxes payable under the GST Laws
and furnish a return for each Tax Period.
6.
Threshold Limit:
There
shall be a taxable limit (presently, `. 10 Lakhs in North Eastern States
& `. 20 Lakhs in rest of the county)
7.
Composition Scheme
The
GST Laws will provide a composition scheme for small dealers (presently,
turnover of `. 75 Lakhs).
8.
GSTIN or GST Identification Number
Every
registrants or dealers ( including Exporters and Importers) shall be given a
PAN based TIN number which shall be a common to the both the State GST and
Central GST.
9.
Compensation to States
The
GST Laws provides for payment of compensation to the States for loss of
revenue, if any, arising out of implementing of the Goods and Services Tax for
a period of 5 years.
10.
The GST Council
The
Council is a quasi – judicial body of States and the Centre, represented
by the State Finance Ministers or Taxation Ministers and the Finance
Minister of India. The key role of this Council is to make recommendations on
various provisions of GST Laws to the State and the Centre.
11.
Anti-Profiteering Measures –
It
is expected the GST Laws will bring down the prices of goods and services once
implemented. To ensure the pass of such benefits to end users or the customers,
the government has put anti-profiteering measures.
12.
Transition
Elaborate
‘Transitions Provisions” for smooth transition of existing tax payers to new
Indirect Tax Regime provided.
It
is expected that the GST Laws or new indirect tax regime, brings benefits to
all the stakeholders viz. industry, government and the citizens. Further, lower
the cost of goods and services, boost the economy and make our products and
services globally competitive.
* The
Author is a budding tax law professional and may be reached at shreetaxchambers
@ bsnl.in
- See more at:
http://taxguru.in/goods-and-service-tax/gst-laws-salient-features.html#sthash.jdxaFL9U.dpuf
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