Write an essay on impact of GST
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Goods and Services Tax (GST) is an indirect tax. The GST Bill was discussed in length in Parliament in order to end the prevailing taxation system of imposing various indirect taxes and implement a new system in which most of these taxes will be covered under one umbrella.
On 8th September, 2016, President Pranab Mukherjee gave assent to this Bill, making it an Act.
In order to understand the features and objectives of GST Act, first we need to take a quick look on the previous taxation system.
Previously taxes were charged on every stage viz. excise on manufacture, VAT/CST on sales, entry tax on entry of goods in local area etc.
These taxes get accumulated with the original price as the input credit for the tax already paid is not available to the consumers. This cascading effect of tax i.e. tax on tax results in hiking the prices of goods or services.
These taxes were imposed by the Centre and state differently according to the Lists in The Constitution of India.
Now the new concept of GST is that the GST would be a single tax system which would be levied on ‘supply’ of goods and services and this tax will be jointly imposed by the Centre and the state with the recommendation of a Federal Institution created which is the GST Council.
On 8th September, 2016, President Pranab Mukherjee gave assent to this Bill, making it an Act.
In order to understand the features and objectives of GST Act, first we need to take a quick look on the previous taxation system.
Previously taxes were charged on every stage viz. excise on manufacture, VAT/CST on sales, entry tax on entry of goods in local area etc.
These taxes get accumulated with the original price as the input credit for the tax already paid is not available to the consumers. This cascading effect of tax i.e. tax on tax results in hiking the prices of goods or services.
These taxes were imposed by the Centre and state differently according to the Lists in The Constitution of India.
Now the new concept of GST is that the GST would be a single tax system which would be levied on ‘supply’ of goods and services and this tax will be jointly imposed by the Centre and the state with the recommendation of a Federal Institution created which is the GST Council.
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