Goods and Service Tax – GST – By: – Deepak Aggarwal – Dated:- 7-2-2015 – GST……Goods and Services Tax Part-C First Discussion Paper on GST Second Segment explains the process of preparation for GST which is already covered in my first article- Part-A. Third Segment explains in detail the comprehensive structure of the GST model in India. India is country which have a federal system in which Centre and State both have powers in their domain and legislation in which they operate. Due to federal system, a Dual GST structure is recommended in India. In Dual GST structure, Central and State will have pre-defined functions and responsibilities. GST will have two components. One component will be Central GST (CGST) which will b
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ss all states. In case of CGST, threshold limit suggested for goods is ₹ 1.5 crore and in case of services, a higher limit is desirable. The CGST and SGST will be paid separately to accounts of Central and state government respectively. The CGST and SGST will be treated separately. In books of accounts, there will be separate accounts for the utilization or refund of credit. Cross utilization of Input tax credit (ITC) between the CGST and SGST will not be allowed. The Central government and State government would have concurrent jurisdiction in GST model. CGST will be administered by Central government and SGST will be administered by State government. A Composition / Compounding scheme is also suggested in GST model. The Scheme
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State Taxes will be subsumed in GST. Central Taxes subsumed in GST are Central Excise duty, Additional Excise duties, Excise duty levied under MTP Act, Service Tax, Additional Custom duty (CVD), Special additional duty (SAD), Surcharges and Cesses. State Taxes subsumed in GST are VAT/Sales tax, Entertainment tax, Luxury tax, Taxes on lottery, betting and gambling, State Cesses and Surcharges related to supply of goods and services and Entry tax. Regarding Purchase tax, it is not clear that whether it will be subsumed in GST or not. Some specific provisions for specific commodities are also suggested. E.g. Alcoholic beverage, Petroleum products would be kept outside ambit of GST. In case of Interstate transactions, IGST model is suggeste
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