GST

( GOODS AND SERVICE TAXES )

BIGGEST TAX REFORM SINCE

INDEPENDENCE…………

A S ATHIRA
 GST??
• Comprehensive tax levy on
manufacture, sale and
consumption of goods and
service at a national level.
• Tax on goods and services
with value addition at each
stage.
• Include many state and
central level indirect taxes.
• Overcomes drawback present
tax system.
• The goods and services tax is a Value Added Tax(VAT) to be
implemented in India, from April 2017.

• One of the aims of introducing GST is to reduce the

cascading effects of taxes which is the primary focus of VAT.

• But VAT system is not comprehensive enough to do so.

 CENTRAL GST(CGST) STATE GST(SGST)

• Central excise duty • VAT

• Additional excise duty • Purchase tax
• Service tax • Entertainment tax
• Countervailing duty(CVD) • Luxury tax
• Additional duty of • Lottery tax
customs(ADC) • State surcharge and cesses
• Surcharge, Education and
Secondary/Higher
secondary cess
 PRESENT TAX SYSTEM

Product sold from Mumbai

to Nagpur VAT @10% - R s 100
Price – R s 1000

• Product sold from

Nagpur to Chennai
Total CST @ 10% - R s 210 • Price – R s 1100
cost- R s • Profit – 1000
2310 • Sale price – R s 2100
 GST SYSTEM

Product sold from Mumbai

to Nagpur CGST @5% -R s 50
Price – R s 1000 SGST @5%- R s 50

• Product sold from

Nagpur to Chennai
Total IGST @ 10% - R s 210 • Price – R s 1100
cost- R s • Profit – 1000
2210 • Sale price – R s 2100

Less : CGST
SGST
ADVANTAGES OF
GST

• Ease of doing business

• Attractive for foreign investors
• FDI
• No tax evasion
• Inventory cost will fall
• Make in India
• Common market
• Manufacture goods could become
cheap
• GDP lift
 COMMODITIES NOT INCLUDED IN GST

• Alcohol
• Petroleum products
• Tobacco products
 TAXES NOT INCLUDED IN GST

• Stamp duty
• Property tax
• Toll tax
• Electricity tax
IMPACT ON GOVERNMENT

• Increases GDP

• Enhanced revenue

• Improved ranking
 IMPACT OF GST
TRADE AND INDUSTRY
• Reduction in cost
• Enhanced margin
• Reduction in litigation
• Create a single unified
national market
CONSUMERS
• Same quality and reduced
price
• Being a new tax , it will take
time for people to
understand it completely
• Services like airlines ,
telecom etc. will become
more expensive
TAX RATES
 DISADVANTAGES
• Dual control on every
business by central and
state government.
• VAT and service tax of some
products may become than
the current levels.
• Manufacturing states may
lose big revenue.