GST (Goods and Service Tax)

• It is a tax levied uniformly on goods and services, throughout the country (July 2017) 
• motto: One nation, one tax, one market.
• article 366 - clause 12A of Indian constitution, defines GST as Any tax on supply of goods and service or both except taxes on the supply at the alcoholic liquor for human consumption.
• introduced with an intention to simplify indirect tax.

The indirect taxes of centre subsumed into GST

1. central excise duty
2. additional excise duty
3. excide duty levied under medicinal and toilet preparation act
4. service tax
5. additional customs and duty
6. special additional duty of customs 

The Indirect taxes of states subsumed into GST

1. Vat
2. entertainment tax
3. central sales tax
4. purchase tax
5. luxury tax
6. taxes on lottery betting and gambling
7. surcharges

Salient Features of GST

• GST is claimed to have the potential to GDP growth up to 2%
• it is a destination-based tax.
• it is paid either by seller recipient or both - reverse charge
• Actual incidence usually falls on the recipient
• the rules of GST more or less some across India
• there will be no competition between states to reduce tax and attract investment.
• As multiple levels of production goes away the burden on tax player is reduced
• prices of goods and services may come  down
• the centre and state simultaneously levy GST on a common base.
• GST levied by centre- GST, by state SGST
• UTs without legislature - UTGST.

Benefits of GST

• seamless of the flow of credit
• elimination of cascading effect
• increase revenue
• enhance transparency
• zero-rated exports 
• increased uniformity
• lends greater certainty to the taxation system
• increases digitalisation
• goods and services tax network.