GST – GST Law and Procedure – 045 – Chapter Forty Five Benefits of Goods and Services Tax (GST) GST stands for Goods and Services Tax which is levied on the supply of goods or services or both in India. GST subsumes a number of existing indirect taxes which were earlier levied by the Centre and State Governments including Central Excise duty, Service Tax, VAT, Purchase Tax, Central Sales Tax, Entry Tax, Local Body Taxes, Octroi, Luxury Tax, etc. It brings benefits to all the stakeholders viz. industry, government and the citizens. It is expected to lower the cost of goods and services, boost the economy and make our products and services globally competitive. GST will make India a common national market with uniform tax rates and procedures and removes the economic barriers, thereby paving the way for an integrated economy at the national level. By subsuming most of the Central and State indirect taxes into a single tax and by allowing a set-off of prior-stage taxes for the transactio
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rated in entirety unlike the earlier system where refund of some taxes was not allowed due to fragmented nature of indirect taxes between the Centre and the States. All taxes paid on the goods or services exported or on the inputs or input services used in the supply of such export goods or services shall be refunded. The principle of exporting only the cost of goods or services and not taxes would be followed. This will boost Indian exports thereby improving the balance of payments position. Exporters are being facilitated by grant of provisional refund of 90% of their claims within seven days of issue of acknowledgement of their application, thereby resulting in the easing of position with respect to cash flows. Benefits of Goods and Services Tax (GST) GST is expected to bring buoyancy to the Government Revenue by widening the tax base and improving the taxpayer compliance. GST is likely to improve India s ranking in the Ease of Doing Business Index and is estimated to increase the
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ces and manpower in maintaining records. Common procedures for registration of taxpayers, refund of taxes, uniform formats of tax return, common tax base, common system of classification of goods or services along with timelines for every activity will lend greater certainty to taxation system. GST is largely technology driven. The interface of the taxpayer with the tax authorities is through the common portal (GSTN). There are simplified and automated procedures for various processes such as registration, returns, refunds, tax payments, etc. All processes, be it of applying for registration, filing of returns, payment of taxes, filing of refund claims etc. , is done online through GSTN. The input tax credit will be verified online. Electronic matching of input tax credit all – across India will make the process more transparent and accountable. This will encourage a culture of compliance. This will greatly reduce the human interface between the taxpayer and the tax administration lead
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