First Discussion Paper on GST( Goods & Service tax) released
63First discussion paper on GST.
The Empowered Committee of State Finance Minister has released GST (Goods & Service tax) First discussion paper. GST is the combition of Goods tax like VAT, CST, Excise & service tax. GST is coming to India to uniform the rates of VAT, CST & Central excise. The main features of the first discussion paper are as follows.
1- GST will be divided in two parts with the main ID number such as CGST(Central Goods & service tax) and SGST( state goods and service tax)
2- In CGST the different central taxes will sum such as
(a) Central Excise
(b) Service Tax
(c) Additional Custom Duty (CVD)
(d) Special Additional Duty of Custom-4%(SAD)
(e) Additional Excise Duties
(f) Cess
(g) Surcharges
3- In SGST the different State taxes will sum as
(a) VAT/Sales Tax
(b) Luxury Tax
(c) Entertainment Tax
(d) State Cess
(e) State Surcharges
(f) Entry Tax
(g) Tax on gambling, lottery
4- Purchase tax, tax on alcohol, tobboco and petroleum products is not merged in GST.
5- There will be one GST which will the combination of CGST+SGST and applicable on all interstate transaction and the tax applicable on value addition. Input input tax credit will be available to both importing and exporting states dealers.
6- There will 10 lakh basic exemption in SGST and 1.5 crore exemption in CGST.
7- All Dealers will be registered through internet as e-registered.
8- All dealers will be issued a registration number which will be PAN (Permanent account number) based.
9- GST rates are yet to finalize.
10- GST will be applicable from 01-04-2010.
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FREEWORKING says:
2 months ago
There was a burden of “tax on tax” in the pre-existing Central excise duty of the Government of India and sales tax system of the State Governments. The introduction of Central VAT (CENVAT) has removed the cascading burden of “tax on tax” to a good extent by providing a mechanism of “set off” for tax paid on inputs and services up to the stage of production, and has been an improvement over the pre-existing Central excise duty. Similarly, the introduction of VAT in the States has removed the cascading effect by giving set-off for tax paid on inputs as well as tax paid on previous purchases and has again been an improvement over the previous sales tax regime.