Goods and Service Tax is a destination based tax which is imposed on every value addition on made at every stage right from manufacture up to final consumption. As GST is levied on every stage, the taxpayer can avail input tax credit of the GST paid on the previous stage while computing their respective tax liability. This helps in eliminating the element of double taxation.
Dual GST is implemented in India
When we say dual GST, it does not mean double taxation. It simply means that Central and State government simultaneously levy GST on a common tax base.
Dual GST is required keeping in mind the requirement of fiscal federalism under Indian Constitution. As Central as well as State government have powers to levy and collect taxes. Government at both levels has distinct set of responsibilities and in the process of doing that taxes constitute as the main source of income.
Registration under GST is state specific. This means that if a single person is operating his business in more than one state and has a place of business in both states then he is required to get two separate registrations in both places.
STEP 1: To initiate the GST registration process Create a login on the GST portal to initiate the GST registration process. To initiate a unique PAN and contact details are required. After filling in the required information and verification through Part 1 GST REG-01 a Temporary Reference Number (TRN) will be generated.
STEP 2: Once the the TRN is successfully generated, the applicant is required to upload all the required documents in Part 2 of GST REG-01. After final submission of the form an Application Reference Number (ARN) is generated. Using this ARN one can track the application status.
STEP 3: In case any deficiency is found in the application, then it is communicated to the applicant in FORM GST REG-04.
STEP 4: After due verification if the officer is satisfied, then a certificate of registration in FORM GST REG-06.
At the time of GST implementation many have wondered exactly how will GST benefit the Indian Economy. But, in reality it is a very significant step in the processes of revolutionizing the Indian indirect structure. It has amalgamated a number of central and state level indirect taxes, which has simplified the process of setting off of Input tax credit.
Introduction of Goods and Service Tax is a much appreciated step. The benefits to the economy are multi-fold. Following are some of such benefits:
Despite GST being a much appreciated step. After its implementation many issues have been identified in the system. Following are some of those challenges identified after its implementation:
This simply means that the tax would accrue to that state authority under whose jurisdiction where place of supply is located i.e. place of consumption of goods.
Following items are not covered under the purview of GST:
Such item will continue to be regulated by previous taxation system of VAT & Central Excise.
NO, GST registration is not mandatory for all the traders. However, Section 24 of CGST Act specifies a list of suppliers who are mandatorily required to be registered under GST, they are:
Exports are zero rated supplies under GST. No tax payment is done in case of exports of goods or services.
Yes, ITC can be available and same will be available as refund to the exporters.
It is Optional.
If the taxpayer is affecting any interstate supplies then it cannot register under composition scheme.
Return submission helps in many ways, like:
Every registered taxpayer is required to file returns. Even in case of no transactions, nil return is to be filed.