GST
Goods and Services Tax (GST) is
an indirect tax which was introduced in India on 1 July 2017 and was
applicable throughout India which replaced multiple cascading taxes levied by
the central and state governments. It was introduced as The
Constitution (one Hundred and First Amendment) Act 2017 following the
passage of Constitution 122nd Amendment Bill. The GST is governed by a GST
Council and its Chairman is the Finance Minister of India. Under GST,
goods and services are taxed at the following rates, 0%, 5%, 12% ,18% and
28%.There is a special rate of 0.25% on rough precious and semi-precious stones
and 3% on gold. In addition a cess of 15% or other rates
on top of 28% GST applies on few items like aerated drinks, luxury cars and
tobacco products.GST was initially proposed to replace a slew of indirect taxes
with a unified tax and was therefore set to dramatically reshape the country's
2 trillion dollar economy. The rate of GST in India is between double to
four times that levied in other countries like Singapore. GST is one indirect tax
for the whole nation, which will make India one unified common market.
GST is a single tax on the supply of goods and services,
right from the manufacturer to the consumer. Credits of input taxes paid at
each stage will be available in the subsequent stage of value addition, which
makes GST essentially a tax only on value addition at each stage. The final
consumer will thus bear only the GST charged by the last dealer in the supply
chain, with set-off benefits at all the previous stages.
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