All You Need To Know About Goods And Services Tax

Economy

All You Need To Know About Goods And Services Tax

GST is applicable on all goods and services except on alcoholic beverages and petroleum products.

The Goods and Services Tax or GST which was implemented in July 2017 subsumed all the central excise duties and local levies. GST is a destination based tax on consumption of goods and services. It is proposed to be levied at all stages right from manufacture up to final consumption with credit of taxes paid at previous stages available as setoff, Central Board of Indirect Taxes and Customs, the policy making body of Goods and Services Tax said on its website.

Goods and Services Tax (GST) regime in India: Here are important things to know about GST:

The Goods and Services Tax replaced a whole host excise duties, service tax, surcharges and cesses, sales tax, state value added tax (VAT) and other taxes with one single tax.

The GST is applicable on all goods and services except on alcoholic beverages and petroleum products.

GST Council headed by the Union Finance Minister is the governing body of the GST and comprises of Finance Ministers of states. The GST Council is tasked to oversee the implementation of GST and the council also decides on tax rates for various items.

Currently, there are four different GST rates being charged by the government depending on different product categories. The four GST rate slabs are 5 per cent, 12 per cent, 18 per cent and 28 per cent.

The Goods and Services Tax has been designed in a way that essential commodities like food items are priced at a lower tax rate while non-essential commodities like luxury cars are priced at the highest tax rate of 28 per cent.

COMMENT

Some very essential commodities like wheat flour, rice, fresh vegetables and fruits, milk, chicken, meat, eggs, salt, jaggery etc. have been exempted from the GST regime.

Written by Anindita Ghosh