Goods and

Service Tax
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 Learning Outcome

Able to understand the concept of indirect taxes along with basic

of GST and the procedure for registration. ( K2 , PO4)
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 Outline :
• Concept of Tax
• Need for Tax
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• Concept of GST
3

• Advantages of GST
• Components of GST
 What is TAX ??
Compulsory/Mandatory
Enforced Payment
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Not a voluntary payment
4

Unrequited Payment
 WHY TAX ??
In a Welfare State, the Government takes primary responsibility for the welfare of its
citizens, as in matters of health care, education, employment, infrastructure, social
security and other development needs. To facilitate these, Government needs revenue.
The taxation is the primary source of revenue to the Government for incurring such
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public welfare expenditure

 Immediate Effect ( Ultimate Effect (
Impact of tax) Incidence of tax)
Effect
of Is on the
person on Who is
Tax whom tax is ultimately
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bearing the
tax burden
is liable to pay
such tax
 About GST

Goods and Services Tax (GST) is an indirect

tax (or consumption tax ) used in India on
the supply of goods and services.
With effect from 1st July 2017, GST is
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applicable on supply of goods or services or

both. This tax is applicable to the whole of
India. (One nation one tax).
.
Constitutional Amendments
Constitution (122nd Amendment) Bill, 2014 received the assent of the President of India on 8th
September, 2016 and became Constitution (101st Amendment) Act, 2016, which paved the way for
introduction of GST in India. Constitution (101st Amendment) Act, 2016 was enacted on 8th
September, 2016, with following significant amendments :

Concurrent powers on Parliament and State Legislatures to make laws governing goods and
services. It means there will be dual control of Stat and Central authorities for all assesses.
As per Article 246A, the power to levy GST has been given to the Parliament as well as to
Legislature of every State.

a. CGST – enacted by Central Government of India.

b. IGST – enacted by Central Government of India.
c. SGST – enacted by respective State Governments
d. UTGST – enacted by Central Government
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IGST will be apportioned between Centre and the States in the manner provided by Parliament by
Law as per the recommendation of the GST Council.
(d) GST will be levied on all supply of goods and services except alcoholic liquor for human
consumption
Principles for determining the place of supply and when a supply takes place in the course of inter-
state trade or commerce shall be decided by the Parliament.
 Advantages of
GST
• One Nation One Tax.
• Removal of bundled indirect taxes such as VAT, CST, Service tax,
CAD, SAD, and Excise.
• Removal of cascading effect of taxes i.e. removes tax on tax.
• Increased ease of doing business;
• Lower cost of production, increases demand will lead to increase
supply. Hence, this will ultimately lead to rise in the production of
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goods. Resultantly boost to make in India initiative.
• It will boost export and manufacturing activity, generate more
employment and thus increase GDP with gainful employment leading
to substantive economic growth
.

Taxable Event ( event on which tax liability
is imposed) under GST shall be supply of
Goods or services or both where ; Supply
includes:
All forms of supply like sales, transfer,
IMPORTANT exchange, license, lease etc. that is made by
a person for consideration in his business .
Unlike multiple taxable events before GST
Regime
FEATURES OF
It is based on destination
based consumption tax
principle i.e. Tax is
accrue at the place where
goods and services are
consumed not produced
Self supply of goods and
services, subject to tax .
Transfer of goods and services
from one branch in one state to
the other state branch . Ex :
Mr. X (Head office, Mumbai)
transfers goods to Mr.
Y(Branch, UP)

GST

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Dual GST where tax
imposed concurrently It brings uniform tax
by the Central and structure all over
States. India
 • To remove multiple taxes.
• To remove cascading effect
• Taxes levied by Central Govt were not set off against

Why
taxes levied by State Govt.
• Different VAT laws in force in different parts of the

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GST ? BBA 309
Country.
• Multiple barriers hinders the flow of free trade.
11

• Some taxes levied by state Govt were not allowed to

be set off against other State Govt Taxes
 Pre – Post GST
Pre GST Post GST

Multiple Tax Events Single taxable event

Origin Based Destination Based

Two separate legal entites required to complete Self supply ( One branch to another or Head office
the transaction to Branch)
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No tax if transaction is without any consideration. Tax even if without consideration (Sec 7 (1) (c).

Multiple tax Single tax

 CGST is to be
administered by
Components of GST
Central
Government. To
Govern Central
goods and services
tax, CGST Act,
2017 has been
passed
SGST is to be administered by
State Government. To Govern
State goods and services tax,
SGST Act, 2017 has been IGST is to be levied and
passed collected from Central

CGST
Government on interstate supply
of goods and services. To Govern
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Integrated
13
goods and services UTGST is to be administered by
administrator appointed by
Central Government for union
SGST territory. To Govern Union
territory goods and services tax,
UTGST Act, 2017 has

IGST
UTGST
Key
• Meaning of Tax and its importance
• Concept of GST

Learning
• Need for GST in India and its Benefits
• Structure of GST in India

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 Thank You
References :
TEXTBOOK : GST GOODS & SERVICES TAX , MAXIMAX
PUBLICATIONS , DR. GIRISH AHUJA AND DR. RAVI GUPTA
E CONTENT : ISSUED BY INDIRECT TAXES COMMITTEE , JUNE
8/31/2022 BBA 309 15 2017
WEBSITE USED :WWW.ICAI.ORG; WWW.IDTC.ICAI.OR