Goods and GST Bill passed

[Ganeshan Kalyani]

Dear All,

GST Bill is passed in Rajya Sabha on 03. 08.2016.

A panel under chief economic adviser Arvind Subramanian has recommended a revenue-neutral rate of 15-15.5%, with a standard rate of 17-18% be levied on most goods and all services.

But, there has been no agreement yet on rates of various goods and services, which remains a tricky issue. According to the Bill, passed in the Lok Sabha in May 2015, the rates were to be decided by a GST council headed by the central finance minister with state finance ministers as members.

Let us wait.

Thanks.

[Ganeshan Kalyani]

Citing the example of the proposed pan-India Goods and Services Tax(GST), the IMF on Friday said the country has shown that progress on reforms could attract investment and boost prospects of India’s medium-term growth.

[Ganeshan Kalyani]

Indian economy is likely to achieve 8% GDP by the fiscal end, thanks to the boost given by initiatives such as Make in India, Union minister of state for commerce and industry Nirmala Sitaraman has said. “With Jan Dhan scheme, Aadhaar, better mobile connectivity and direct benefits transfer, India is on a fast growth track,”she said.

[Ganeshan Kalyani]

The minister talked of cab aggregator Uber’s initiative ‘Uber-Pitch’ which allows startups to pitch their ideas to venture capitalists (VC) and investors. “We are open to tying up with more technology platforms for good ideas to emerge. When it comes to startups we want to talk facilitation more than regulation,” said Sitaraman, at a lecture organised by the Chennai International Centre in the city on Saturday. On the industry’s demand to levy extra duty on cheap Chinese imports, the minister said that cheaper import of raw materials has made it possible for many small and medium enterprises to flourish, in turn creating jobs.

Source: GST taxation .com

[Ganeshan Kalyani]

“Outright ban on imports in rubber, steel, copper, pepper and other commodities is not possible. We might look at putting protectionist policies in place, but within a timeframe. The industry has to be resilient from within. I do understand the concerns of large manufacturers, who fear the flood of cheap imports eating into their profit margins,” said the minister.

Source: www.gsttaxation.com

[Ganeshan Kalyani]

Hailing the Goods and Service Tax Bill, she said digitisation of all records will be one of the main drivers of GST. “Once GST comes into being, the Indian economy will be boosted by 1.5%”

 

[Ganeshan Kalyani]

Registration under Goods and Service Tax (GST) regime will confer following advantages to the business:
• Legally recognized as supplier of goods or services.
• Proper accounting of taxes paid on the input goods or services which can be utilized for payment of GST due on supply of goods or services or both by the business.
• Legally authorized to collect tax from his purchasers and pass on the credit of the taxes paid on the goods or services supplied to purchasers or recipients.

[Ganeshan Kalyani]

Without registration under GST, dealer cannot issue tax invoice, cannot collect tax from customer and cannot take input credit of the tax paid on purchases. Composition scheme opted dealer if purchased from unregistered dealer then he has to pay purchase tax.

[Ganeshan Kalyani]

Registration to be applied within 30 days from the date when the exemption threshold limit is crossed.

[Ganeshan Kalyani]

Import of goods into India shall be treated as inter state purchase . The CVD/ SAD will get subsumed and instead IGST would be levied. The credit would be allowed in full. Though both the tax got subsumed in GST, the custom duty is still going to be continued.

[Ganeshan Kalyani]

Foreign investment is expected to grow / increase with the implementation of GST. The indirect taxation would be uniform which will not be hurdle for foreign investors.

[Ganeshan Kalyani]

The input credit mechanism in GST need to be understood.

[Ganeshan Kalyani]

Dedicated tax associates are required in big corporates looking into the number of transactions and multiple tax return that need to be filed. Rigouorus follow with the supplier if he has not paid the tax on sale of material to the purchaser. Only when supplier has paid the tax the purchaser is allowed the said credit.

[Ganeshan Kalyani]

Brazil and Canada has dual GST. Similar to that India is going to have dual GST .

[Ganeshan Kalyani]

CGST: central taxes got subsumed in CGST. States taxes subsumed in SGST and tax on interstate transaction is taxes taxed as IGST.

[Ganeshan Kalyani]

GST shall be implemented by all the States at the same time. This will ensure benefit of GST. In VAT states had adopted VAT in different years.

[Ganeshan Kalyani]

GST shall increase rate in initial years and later the price would come down due to seamless credit available.

[Ganeshan Kalyani]

Customer voice, an NGO suggested the Government to levy tax @40% on tobacco products. This is one way to minimise tobacco consumption by public as increase in tax rate means increase in cost of tobacco product.

[Ganeshan Kalyani]

Meeting of GST Council schedule. It is expected that after the meeting is concluded the consensus on GST rate would have been achieved and also on issues related to condensation mechanism.

[Ganeshan Kalyani]

Department of sales tax of Assam asked the dealers to update the information like mobile number, email id, and such basic information. This is required in order to ease transition from current tax regime to GST.

[Ganeshan Kalyani]

Earlier Pndocherry Commercial tax department has asked the dealers to update the contact details and basic details in database by uploading the information in the pondichery vat website.

AI Summary

Goods and Services Tax consolidation creates a dual GST framework with GST Council oversight and a shared IT platform for compliance.
Goods and Services Tax establishes a destination based, dual tax framework subsuming central and state indirect levies, administered through a GST Council and implemented via a shared IT platform (GSTN). The model law sets out registration and return regimes, HSN/SAC classification by turnover bands, input tax credit carry forward, composition and reverse charge rules, refund and valuation procedures, compensation to states during transition, and institutional arrangements for cross empowerment, adjudication and dispute resolution.