What is GST ?

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GST/Goods and Services Tax is the result of the most recent reform in the Indian Taxation System. GST came into effect on 1st July 2017 also known as consumption tax which is levied over the sales of goods and services. GST is one indirect tax system for the whole nation which is making the business doing in-country tax neutral. GST is consumption based or destination based single tax system where the place of destination or consumption will decide the State which will collect the tax. Hence, GST is a one-time tax levied on the supply of goods and services right from the manufacturer to the consumer and gets implied on every step of the production process, but after a duration, the paid taxes are refunded to the all the parties of the production chain excluding the final consumer.

Effect of GST

In pre-GST regime the legislative tax rate for most goods was about 26.5% and various taxes were levied from the customer such as value added tax, service tax, excise duty, etc. but after implementation of GST, it makes All Taxes are combined in One, in addition, post-GST 18% tax range is expected for most of the goods. With lesser compliance and regulation of the unorganized sector, GST improved the collection of taxes as well as the removal of indirect tax barriers and implementing uniform tax rate between states is boosting the development of Indian economy.

Tax Rates

Further, Goods and services are alienated in five different Tax Slabs which are 0%, 5%, 12%, 18% and 28%. The Tax rate varies from some special rate of 0.25% on rough precious and semi-precious stones, 3% on gold to 28% GST over some items like tobacco products, luxurious car, and aerated drinks. Some services and goods such as Petroleum products, electricity, real estate and alcoholic drinks are taxed separately by the individual state government.

What is GST Registration

Tax Subsumed

Now Taxation in India is administered by both Central and State Government system, with three taxes subsumed under GST are CGST which is collected by the Central Government on an intra-state sale (Eg: Within Delhi), SGST which is collected by the State Government on an intra-state sale (Eg: Within Delhi), and IGST which is collected by the Central government on inter-state sale (Eg: Delhi to Punjab), through this GST avoids cascading effect as the tax is now calculated only on the value-add at each stage of ownership getting transferred.

Goods and Services Tax Network (GSTN)

The government further took very important step by making new tax process completely online with providing unique GSTIN id to the dealer where GSTN is the software developed by renowned Indian IT Company Infosys Technology and IT network is maintained by NIC. It is a single portal which is accessible to the taxpayers to access information and the tax authorities for keeping track of every transaction.

 

GST Registration

Government of India mandates GST Registration for the business with annual turnover of more than 20 lakh all over India (with special provisions to some state). GST Registration comprises numerous process of registration with online registration mandatory for certain businesses. Government can place heavy penalty over those organization covered under GST scheme but are operating without GST registration.

Here at Tick and Tie, we are happy to assist your Business with GST Registration and Online Apply for GST number. GST registration is also required for previously registered business with the pre-GST law.

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