Goods and Service Tax – GST – By: – Deepak Aggarwal – Dated:- 6-2-2015 – GST……Goods and Services Tax Part-B First Discussion Paper on GST- 1st Segment First Segment of First Discussion Paper on GST explains a brief reference to the process of introduction of VAT in the Centre and in the States and also areas where needs further improvements i.e. justification for GST. Introduction of VAT In India, VAT was introduced at the Central level for a selected number of commodities in terms of MODVAT w.e.f March, 1986 and later it is extended to all commodities in terms of CENVAT w.e.f. 2002-03. Later on Service tax was added to CENVAT w.e.f. 2004-05. Vat was introduced at the State level beginning from April, 2005. Before introdu
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veral Central taxes e.g. additional customs duty, surcharges etc. – Non-inclusion of value added chain in the distribution trade below the manufacturing level Shortcomings- at State level -Non-inclusion of several state taxes e.g. luxury tax, entertainment tax etc. -Cascading effect on account of Cenvat element i.e. excise duty on the goods remains included in the value of goods to be taxed under state VAT – No credit of input services at state level After introduction of GST, all shortcomings at Central and State level will be removed. At Central level -GST will provide comprehensively more indirect central taxes -Integrate goods and service taxes for the purpose of set-off relief -Widening of dealer base by capturing the value addition i
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