Goods and service tax GST is a comprehensive indirect tax on manufacture, sale, and consumption of goods and services through out India. GST would replace respective tax levied by the central and the state governments
What is GST?
- it is a destination based taxation system
- it has been established by 101st Constitutional Amendment Act
- it is an indirect tax for the whole country on the line of "one Nation one tax" to make India a unified market.
- it is a single tax on supply of goods and services in its entire product cycle or life cycle i.e. from manufacturer to the consumer.
- it is calculated only in the "value addition" at any stage of good or service.
- the final consumer will pay only his part of the tax not the entire supply chain which was the case earlier.
- there is a provision of GST Council to decide upon any matter related to GST who's chairman in the finance minister of India.
what taxes at centre and state level are incorporated into GST
At the state level
- state value added tax/Sale Tax
- entertainment tax (other than the tax levied by the local bodies)
- Octroi and Entry tax
- purchase tax
- luxury tax
- tax on lottery, betting and gambling
At the Central level
- central excise duty
- additional excise duty
- service tax
- additional custom duty (countervailing duty)
- special additional duty of customs
