What is GST 2017 in India? Important Highlights, Facts, FAQs, & Rates

What is GST 2017 in India? Important Highlights, Facts, FAQs, & Rates

 

 

Hello Readers,

 

Welcome to Eduscoop!

 

 

We all are aware of the fact that our country’s tax system is very complicated. Due to this complexity, the startup business entities find difficult to grow, as they face a lot of direct and indirect taxes.

 

To solve the problems that arise through this complex tax system in India, the Government has proposed a Goods and Services Tax or GST. We can also consider it as ‘One Tax for All Taxes’. GST is now grabbing the attention of every citizen of India as they will get impacted by the rules set in the GST Act.

 

 

Here, in this article, we have put together: –

 

 

The meaning of GST (Goods and Service Tax) or GST Act 2017

 

 The journey of Goods and Service Tax ‘GST’ from 2006 to 2017

 

 GST Council

 

 Its Key Features

 

 Existing Indirect Tax Structure in India replaced by GST

 

 Complete GST Rate Schedule

 

 Its benefits & Impact on Economy

 

 

 

Download Here Currents Affairs and GK Updates [Weekly and Monthly PDFs]

 

 

What is Goods and Service Tax (GST) in India?

 

 

GST or Goods and Service Tax is a tax that is imposed on sale, manufacturing, and usage of goods and services. It is enforced on services and goods at the national level with a purpose of achieving overall Economic Growth. GST will take over the indirect taxes that used to be imposed by the Centre and States on goods and services.

 

The tax is different in every country. GST is imposed to collect revenues for the Government. The consumers pay the tax to the Government through the business entities from which they bought the goods and services.

 

 

 

How the Journey of GST started from the year 2006 to 2017?

 

 

Goods and Service Tax has not raised in just one day. It is the combined efforts of 10 years’ planning that has gone through many committee meetings, training of professionals, hours of discussion by GST Council, and Constitution Amendments approval. Let’s take up the yearly synopsis of its journey with the help of the points given below: –

 

 

2006 - Announcement to introduce GST by the year 2010

 

2009 - First Discussion Paper (FDP) released by EC

 

2011 - Constitution (115th Amendment) Bill introduced

 

2013 - Three committees constituted by EC and GSTN set up

 

2014 - Constitution (122nd Amendment) Bill (CAB) introduced in Lok Sabha

 

2016 - Constitution Amendment Bill passed

 

2017 - 12 GST Council Meetings held and CGST, SGST, UTGST, IGST, Compensation Cess Bills recommended.

 

 

 

How is GST Council 2017 Formed? Composition and Members

 

 

The GST Council was a joint forum of the Centre and the States. The council consisted the following members: –

 

 

Arun Jaitley, Union Finance Minister and Chairperson of GST Council

 

 Santosh Kumar Gangwar, Union Minister of State and in-charge of Revenue of Finance

 

 Senior IAS officer Arun Goyal, Additional Secretary GST Council

 

 The Minister in Charge of Finance or Taxation or any other Minister, nominated by each state Government.

 

 

 

What are the Key Features of Goods and Service Tax?

 

Below, we are combining the most prominent features of Goods and Service Tax (GST): –

 

 

1. GST comprises of all the Central Indirect Taxes like Excise Duty, Service Tax, Special Additional Duty of Customs, Countervailing Duty, Central Surcharges and Cesses till they relate to the supply and consumption of goods and services.

 

2. It also includes State Value Added Tax or Sales Tax, Entertainment Tax, (excluding the tax charged by the local bodies), Entry and Octroi Tax, Central Sales Tax (taxed by the Centre and collected by the State Government), Purchase Tax, Luxury Tax, Taxes on betting, lottery and State cesses and surcharges involved in the supply and consumption of services and goods.

 

3. It is having Indian Constitution’s concept of ‘declared goods of special importance’.

 

4. There is an additional tax of 1% on the supply of goods in inter-State trade which will be collected by the Government of India for a period of two years and will be allocated to the states from where the supply comes.

 

5. Petroleum, Petroleum Products, and Alcohol are kept out of the reach of GST.

 

6. There are two elements; Central GST levied by Centre and State GST levied by the states.

 

7. On interstate trade in goods and services, an additional tax of 1% is also imposed that will be collected by the Centre and provided to the states for two years. It will help in refunding the loss of implementing GST faced by the states.

 

8. A Goods and Services Tax Council is also formed to solve the issues of goods and services tax. The council will also instruct the Union and the States for operating rates, exemption list, and threshold limits.

 

 

 

What was the Earlier Existed Indirect Tax Structure in India?

 

 

The old structure of taxation in Indian economy was also divided into two parts as Central Taxes and State Taxes. But these two elements were also subdivided into many parts which made the taxation bulkier.

Let’s understand it as below: –

 

 

Central Taxes

 

Central Excise duty

 Additional duties of excise

 Excise duty levied under Medicinal & Toiletries Preparation Act

 Additional duties of customs (CVD & SAD)

 Service Tax

 Surcharges & Cesses

 

 

State Taxes

 

 State VAT / Sales Tax

 Central Sales Tax

 Purchase Tax

 Entertainment Tax (other than those levied by local bodies)

 Luxury Tax

 Entry Tax (All forms)

 Taxes on lottery, betting & Gambling

 Surcharges & Cesses

 

 

All the above-given taxes are now replaced by the Goods and Service Tax (GST) 2017.

 

 

 

What is the GST Rate Schedule for Goods and Services? Complete Guide

 

On 1st July 2017, Goods and Service Tax (GST) declared four tax rates that are 5%, 12%, 18%, and 28%. These taxes will be applied to the services like telecom, insurance, hotels, and restaurants.

 

The GST Council decided to levy 1 per cent Tax Collected at Source (TCS) rate for e-commerce players such as Flipkart, Snapdeal, etc.

 

Below we are giving the complete official list of Goods and Services Tax Rates: –

 

 

Download (PDF, 349KB)

 

 

 

What is the Impact of GST on Indian Economy and Consumers?

 

 

 

GST has been launched with an aim of “One Nation, One Tax, One Market”. The tax rates decided by the council will throw a significant impact on our economy as well us on the consumers.

 

 

The Benefits of GST can be understood with the following points: –

 

 

Benefits for Trade –

 

 

Multiple Taxes will be reduced.

 

 The problem of cascading/ double taxation will be cured.

 

 Taxes for Exports will efficiently be dissolute.

 

 The common national market will be developed.

 

 Tax regime will be simplified.

 

 There will be less tax and exemption will be more.

 

 The distinction between Goods and Services will not be required

 

 

 

Benefits for Consumers –

 

 

 Tax System will be simplified.

 

 Prices of Goods and Services will be reduced because of the elimination of cascading.

 

 There will be uniform prices all over the country.

 

 There will be more transparency in the taxing system of the country.

 

 Employment opportunity will get a boost.

 

 

As the prices of goods and services changed due to the new taxation system. It will also impact the consumer. Below is the list of goods and services from cheaper to costlier: –

 

 

CHEAPER COSTLIER
Maida, Besan, Salt, Unbranded Atta, Unpacked Food grains

 

 Fresh Vegetables and Fruits Food at Small Restaurants

 

 Cutlery, Ketchup, Sauces, and Pickle

 

 Soaps, Hair Oil and Toothpaste

 

 Pressure Cookers and Pans

 

 Movie Tickets that costs less than 100 Rs.

 

 Rooms at Non-luxury hotels and hotels with tariffs of less than Rs 7500

 

 Footwear and Apparels, weighing machinery, UPS, Revenue Stamps

 

 Airfares for economy class travel

 

 Bikes/ Scooter with engine capacity below 350 cc SUVs

 Tea and Coffee

 

 Food at fine dining Restaurant and five-star hotels

 

 Shampoo and deodorants

 

 TVs Refrigerators, ACs, Washing Machine

 

 Movie tickets above Rs. 100

 

 Hotels which have room tariffs over Rs. 7500

 

 Courier services, mobile phone tariffs, insurance premium, banking charges, broadband services

 

 Aerated drinks, Tobacco

 

 Tuition fees, Buying a flat/shop

 

 Airfare for business class and train tickets

 

 Bikes which have an engine capacity of over 350 cc

 

 

 

What PM Modi Says About the GST Launch?

 

 

On the day of GST Launch (1st July 2017), Prime Minister Narendra Modi placed a speech on GST. These are the memorable quotes by him, please have a look –

 

 

“Today, the GST Council had its 18th meeting. It is a coincidence that the Bhagavad Gita also had 18 Chapters”

 

“Historic reform GST is not an achievement of any one party or Government”

 

“At midnight, we will together decide the course of the future of this country”

 

“We have united in the Central Hall. This is a place where many iv=cons of our country have set foot”

 

 

 

Register Now to get more study stuff on Eduncle for preparing competitive exams!

 

 

These were the important things that should be marked by the citizens of the country.

 

The major decision of implementing the GST Act 2017 has received mixed reviews. For some people, it is good and for others, it’s sad news. We want to hear your views on the GST Launch.

 

So, please write your views about GST in the comment section below. Your thoughts are welcomed here.

 

Stay tuned with us for more news and latest happenings in the country and the world. Follow us on Facebook and YouTube!

 

Thank You 

 

 

 

Share This Post

PinIt
Expert advise guide for exam preparation
Like the Post? Subscribe to Eduncle Blog

Even if you don't visit eduncle.com on a regular basis, you can get the latest posts and updates delivered to you for free via Email.

6    +   1   =  
  

2 thoughts on “What is GST 2017 in India? Important Highlights, Facts, FAQs, & Rates

  1. satyabrata

    nice

    • Eduncle Team

      Hello Satyabrata,
      Greetings from Eduncle!
       
      Thanks for the appreciation! We value and regard your feedback!
       
      Kind Regards,
      Eduncle Team

Leave a Reply

Your email address will not be published.

6   +   1   = 

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>