EASWARI ENGINEERING COLLEGE

Department of Management Studies

Assignment-1
NAME OF THE STUDENT MONISHA S
ROLL NUMBER 66
YEAR & SEC 1 & MBA ‘B’ SEC
ST

SUBJECT CODE 193MBC104T

SUBJECT NAME LEGAL ASPECT OF BUSINESS
ASSIGNMENT TOPIC GOVERNMENT PROVISION ON
GST
DATE OF SUBMISSION 31/01/2021
TOTAL MARKS
SIGNATURE OF THE FACULTY
 GOVERNMENT PROVISIONS ON GST

INTRODUCTION

GST is known as goods and service tax. The goods and service tax are an
indirect tax which has intended to replace all the taxes in India levied by
the central and state governments in various forms i.e., excise duty, sales
tax, VAT, entertainment tax, luxury tax, services tax and create a single
tax GST. It is a unified taxation system implemented by the government of
India from 1st July 2017. It is a comprehensive value added tax on goods
and services. Goods and service tax is collected on value added at each
stage of sale or purchase in supply chain. No difference between goods
and services as the GST is levied at each stage in the supply chain.
Seamless input tax credits are throughout the supply chain. At all stages
of production and distribution, taxes pass through and tax is borne by the
final consumer. All sectors are taxed with very few exceptions or
exemptions.  

GST IN INDIA(JOURNEY)

2008 – In Feb 2008 hon’ble finance minister announced introduction of

GST.      
      - In April 2008 the empowered committee finalized and submitted
report titled ‘A model and roadmap for goods and services tax in India’

2009 – In July 2009 finance minister announced commitment to introduce

Goods and service tax.
        - November 2009 first discussion paper released by EC.
        - December 2009 task force constituted by EC released its report

2010 - Feb 2010-mentioned in the speech of FM. Goods and service tax to
be introduced in April 2011

2011 - In March 2011 the constitution 115th amendment bill was

introduced in the Lok Sabha.

2012 – In March 2012 the drafting of a model legislation for the Centre
and State goods and service tax in concert with the States under progress

2013 - Four committees were constituted by the empowered committee of

the State Finance Ministers (EC) to deal with the various aspects of work
relating to the introduction of Goods and service tax.

2014 - December 2014 the constitution 122th amendment bill tabled in

Lok Sabha for levy of GST which should enable the introduction of GST
probably by April 2016.
2016 - Proposed date for the introduction of Goods and service tax.

 
ADVANTAGES OF GST

• No upfront payment of tax or substantial blockage of funds for the inter-

State seller or buyer.
• No refund claim in exporting State, as ITC is used up while paying the
tax.
• Model can take ‘Business to Business’ as well as ‘Business to
Consumer’ transactions into account.
• Self-monitoring mode.
• As all inter-State dealers will be e-registered and correspondence with
them will be by e-mail, the compliance level will improve substantially.
• Life gets simpler where GST will replace 17 indirect tax levies and
compliance costs will fall.
• Revenue will get a boost and evasion set to drop. Input tax credit
encourages suppliers to pay taxes. The number of tax-exempt when goods
decline.
• Common market will be fragmented along state lines, pushing costs up
to 20-30%
• Logistics inventory costs will fall at state borders slow movements of
trucks. In India, they travel 280km a day compared with 800km in the US
• Investment boost for many capital goods, input tax credit is not
available. The input tax credit under goods and service tax will remain a
12-14% drop in the cost of capital goods. Expected a rise of 6% in capital
goods investment, 2% overall

DISADVANTAGES OF GST

• Taxes on service would go up from 15% to 18%.

• Tax on retail would be almost double the cost
• Imported goods would be taxed at higher rate by around 6%.
• Double control on every business i.e., central and State Govt.
• All credit will be available on from online connectivity with GST
network. Therefore, small businesses will find it difficult to use the
system. Service sector have to register in each state with Central & State
Government so every business at all India level will have around 60
registrations while they are having just one today.
• Critics have argued that the GST is a regressive tax, which have more
pronounced effect on lower income earners, meaning that the tax
consumes a higher proportion of their income, compared to those earning
large incomes.
• A study commissioned by the Curtain University of Technology, Perth in
2000 argued that the introduction of the gst would negatively impact the
real estate market as it would add up to 8% to the cost of new homes and
reduce demand by about 12%.

COMPONENTS OF GST

The types of GST are

1. CGST
2. SGST
3. IGST

CGST

CGST means central goods and service tax and it’s a part of GST covered
under central goods and service tax act 2016. The Tax collected under
cgst will be the revenue of central government. CGST subsumed all
present central taxes like central excise duty, additional excise duty,
special excise duty, central sales tax etc.

SGST

SGST means State goods and service tax and it’s a part of GST covered
under state goods and service tax act 2016. The Tax collected under sgst
will be the revenue of state government. Value added tax, entertainment
tax, luxury tax, entry tax etc., will be merged under SGST for example
goods are sold or services are provided within SGST will be levied on
such transactions.  

IGST

IGST means Integrated goods and service tax and it’s a part of GST
covered under Integrated goods and service tax act 2016. The Revenue
collected from Integrated goods and service will be divided between the
Central government and the State government. Integrated goods and
service tax will be charged on transfer of goods and services from one
state to another. The import of goods and services transferred from Punjab
to Goa the transaction will attract IGST.

 
THANK

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