Introduction to Goods and Services Tax in India

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CHAPTER NO.1 Introduction
Chapter No. Chapter Name Page No.
1.1 Introduction to GST 02-04
1.2 History of GST 05-06
1.3 Goods and Service Tax in India 07-09
1.4 Rate of Tax 10-12
1.5 E-Way Bill 12-14
1.6 Input tax credit 15-16
1.7 SWOT Analysis of GST 17-19
1.8 Composition/Compounding Scheme 20-21
1.9 Goods & Services Tax (GST): Revenue
Neutral Rate of Tax
22-24
1.10 Goods and Service Tax Network 25-26
1.11 Harmonization of laws and administration 26-27
1.12 Key features of GST – An overview 28-29
1.13 Issues Challenges in Implementation of
Goods and Services
29-31
1.14 Valuation of Non-monetary consideration
under Service Tax
31-35
1.15 Implications of GST on imports and
exports
35-39

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1.1 Introduction to Goods and Service Tax
GST is one indirect tax for the whole nation, which will make India one unified
common market. GST is a single tax on the supply of goods and services, right from
the manufacturer to the consumer. Credits of input taxes paid at each stage will be
available in the subsequent stage of value addition, which makes GST essentially a tax
only on value addition at each stage. The final consumer will thus bear only the GST
charged by the last dealer in the supply chain, with setoff benefits at all the previous
stages.
The benefits of GST can be summarized as under:

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Which taxes at the Centre and State level are being subsumed into
GST?
For business and industry
Easy compliance: A robust and comprehensive IT system would be the foundation of
the GST regime in India. Therefore, all tax payer services such as registrations, returns,
payments, etc. would be available to the taxpayers online, which would make
compliance easy and transparent.
Uniformity of tax rates and structures
GST will ensure that indirect tax rates and structures are common across the country,
thereby increasing certainty and ease of doing business. In other words, GST would
make doing business in the country tax neutral, irrespective of the choice of place of
doing business.
Removal of cascading
A system of seamless tax credits throughout the value chain, and across boundaries of
States, would ensure that there is minimal cascading of taxes. This would reduce hidden
costs of doing business.
Improved competitiveness
Reduction in transaction costs of doing business would eventually lead to an improved
competitiveness for the trade and industry.
Gain to manufacturers and exporters
The subsuming of major Central and State taxes in GST, complete and comprehensive
setoff of input goods and services and phasing out of Central Sales Tax (CST) would
reduce the cost of locally manufactured goods and services. This will increase the
competitiveness of Indian goods and services in the international market and give boost
to Indian exports. The uniformity in tax rates and procedures across the country will
also go a long way in reducing the compliance cost.

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For Central and State Governments
Simple and easy to administer: Multiple indirect taxes at the Central and State
levels are being replaced by GST. Backed with a robust end-to-end IT system, GST
would be simpler and easier to administer than all other indirect taxes of the Centre
and State levied so far.
Better controls on leakage:
GST will result in better tax compliance due to a robust IT infrastructure. Due to the
seamless transfer of input tax credit from one stage to another in the chain of value
addition, there is an inbuilt mechanism in the design of GST that would incentivize tax
compliance by traders.
Higher revenue efficiency:
GST is expected to decrease the cost of collection of tax revenues of the Government,
and will therefore, lead to higher revenue efficiency.
Why GST?
GST is likely to rationalize irrational, complicated, cumbersome and multiple indirect
tax. It will help stop pilferage and also off load the over loaded tax burden from some
organizations. Improve the tax collection by efficient agency based on scientific and
rational system of assessment rather than current scenario which is largely affected by
corruption Better management of refunding of taxes and hence savings which is a boon
for honest taxpayers Taxes to be levied at the destination which would make the system
less distorting and non-complicated. The current system involves cumbersome process
of assessment and primitive ways of collection which ultimately leads to encourage tax
evasion and also increase cost of commodities. Introduction of GST would certainly
increase the volume of the tax collection and also put India at par with many major
economies of the world.

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1.2 History of GST
Seven months after the formation of the Modi government, the new Finance Minister
Arun Jaitley introduced the GST Bill in the Look Sabha, where the BJP had a majority.
In February 2015, Jaitley set another deadline of 1 April 2017 to implement GST.
Detailed description of history of GST in India
2000 - In India, the idea of adopting GST was first suggested by the Atal Bihari
Vajpayee Government in 2000. The state finance ministers formed an Empowered
Committee (EC) to create a structure for GST, based on their /experience in designing
State VAT. Representatives from the Centre and states were requested to examine
various aspects of the GST proposal and create reports on the thresholds, exemptions,
taxation of inter-state supplies, and taxation of services. The committee was headed by
Asim Dasgupta, the finance minister of West Bengal. Dasgupta chaired the committee
till 2011.
February 2005 - The finance minister, P. Chidambaram, said that the medium-to-long
term goal of the government was to implement a uniform GST structure across the
country, covering the whole production-distribution chain. This was discussed in the
budget session for the financial year 2005-06.
December 2014 - India’s new finance minister, Arun Jaitley, submits the Constitution
(122nd Amendment) Bill, 2014 in the parliament. The opposition demanded that the
Bill be sent for discussion to the standing committee.
Feb 2015 - Jaitley, in his budget speech, indicated that the government is looking to
implement the GST system by 1st April 2016.
May 2015 - The Look Sabha passes the Constitution Amendment Bill. Jaitley also
announced that petroleum would be kept out of the ambit of GST.

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August 2015 - The Bill is not passed in the Rajya Sabha. Jaitley mentions that the
disruption had no specific cause.
March 2016 - Jaitley says that he is in agreement with the Congress’s demand for the
GST rate not to be set above 18%. But he is not inclined to fix the rate at 18%. In the
future if the Government, in an unforeseen emergency, is required to raise the tax rate,
it would have to take the permission of the parliament. So, a fixed rate of tax is ruled
out.
August 2016 - The Congress-led opposition finally agrees to the Government’s
proposal on the four broad amendments to the Bill. The Bill was passed in the Rajya
Sabha.
September 2016 - The Honorable President of India gives his consent for the
Constitution Amendment Bill to become an Act.
2017 - Four Bills related to GST become Act, following approval in the parliament and
the President’s assent: Central GST Bill Integrated GST Bill Union Territory GST Bill
GST (Compensation to States) Bill the GST Council also finalized on the GST rates
and GST rules. The Government declares that the GST Bill will be applicable from 1st
July 2017, following a short delay that is attributed to legal issues.
Some Facts about GST:
The goods and services tax (GST) is a comprehensive value-added tax (VAT) on goods
and services. In India, a dual GST is being proposed wherein a central goods and
services tax (CGST) and a state goods and services tax (SGST) will be levied on the
taxable value of a transaction. The central and state governments are discussing the
GST system proposed to be implemented in India from April 1, 2010.

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1.3 Goods and Service Tax in India
Goods and Services Tax (GST) is an indirect tax (or consumption tax) imposed
in India on the supply of goods and services. GST is imposed at every step in the
production process, but is meant to be refunded to all parties in the various stages of
production other than the final consumer.
Goods and services are divided into five tax slabs for collection of tax - 0%, 5%, 12%,
18% and 28%. 32% However, Petroleum products, alcoholic drinks, electricity, are not
taxed under GST and instead are taxed separately by the individual state governments,
as per the previous tax regime. There is a special rate of 0.25% on rough precious and
semi-precious stones and 3% on gold. In addition a cess of 22% or other rates on top of
28% GST applies on few items like aerated drinks, luxury cars and tobacco
products. Pre-GST, the statutory tax rate for most goods was about 26.5%, Post-GST;
most goods are expected to be in the 18% tax range
The tax came into effect from July 1, 2017 through the implementation of One Hundred
and First Amendment of the Constitution of India by the Indian government. The tax
replaced existing multiple flowing taxes levied by the central and state governments
The tax rates, rules and regulations are governed by the GST Council which consists of
the finance ministers of Centre and all the states. GST is meant to replace a slew of
indirect taxes with a federated tax and is therefore expected to reshape the country's 2.4
trillion dollar economy, but not without criticism. Trucks' travel time in interstate
movement dropped by 20%, because of no interstate check posts.
Salient Features of Proposed Goods and Service in India
Dual GST Model to be introduced in India
 India will adopt a dual GST which will be imposed concurrently by the Centre
and States, i.e. Centre and States will simultaneously tax goods and services.
Centre will have the power to tax intra-State sales & States will be empowered
to tax services. GST will extend to whole of India except the State of Jammu
and Kashmir.

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 GST is a destination based tax applicable on all transaction involving. Supply
of goods and services for a consideration subject to exceptions thereof. GST in
India will comprise of Central Goods and Service Tax (CGST) - levied and
collected by Central Government, State Goods and Service Tax (SGST) - levied
and No CENVAT after manufacturing stage Non-inclusion of several local
levies in State VAT such as luxury tax, entertainment tax, etc. Non- integration
of VAT & service tax Cascading of taxes on account of (i) levy of Non-VAT
able CST and (ii) inclusion of CENVAT in the value for imposing VAT Double
taxation of a transaction as both goods and services collected by State
Governments/Union Territories with State Legislatures and Union Territory
Goods and Service Tax (UTGST) - levied and collected by Union Territories
without State Legislatures, on intra-State supplies of taxable goods and/or
services. Inter-State supplies of taxable goods and/or services will be subject to
Integrated Goods and Service Tax (IGST). IGST will approximately be a sum
total of CGST and SGST/UTGST and will be levied by Centre on all inter-State
supplies.
 There is single Dual GST Model to be introduced in India .India will adopt a
dual GST which will be imposed concurrently by the Centre and States, i.e.
Centre and States will simultaneously tax goods and services. Centre will have
the power to tax intra-State sales & States will be empowered to tax services.
GST will extend to whole of India except the State of Jammu and Kashmir.
 GST is a destination based tax applicable on all transactions involving Supply
of goods and services for a consideration subject to exceptions thereof. GST in
India will comprise of Central Goods and Service Tax (CGST) - levied and
collected by Central Government, State Goods and Service Tax (SGST) - levied
and No CENVAT after manufacturing stage Non-inclusion of several local
levies in State VAT such as luxury tax, entertainment tax, etc. Non- integration
of VAT & service tax Cascading of taxes on account of (i) levy of Non-VAT
able CST and (ii) inclusion of CENVAT in the value for imposing VAT Double

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taxation of a transaction as both goods and services collected by State
Governments/Union Territories with State Legislatures and Union Territory
Goods and Service Tax (UTGST) - levied and collected by Union territories.
 Without State Legislatures, on intra-State supplies of taxable goods and/or
services. Inter-State supplies of taxable goods and/or services will be subject to
Integrated Goods and Service Tax (IGST). IGST will approximately be a sum
total of CGST and SGST/UTGST and will be levied by Centre on all inter-State
supplies.
 Legislation – CGST Act, 2017- for levying CGST Similarly Union Territories
without State Legislatures [Andaman and Nicobar Islands, Lakshadweep, Dadra
and Nagar Haveli, Daman and Diu and Chandigarh] will be governed by
UTGST Act, 2017 for levying UTGST. States and Union territories with their
own legislatures [Delhi and Pondicherry] have to enact their own GST
legislation for levying SGST. Though there would be multiple SGST
legislations, the basic features of law, such as chargeability, definition of taxable
event and taxable person, classification and valuation of goods and services,
procedure for collection and levy of tax and the like would be uniform in all the
SGST legislations, as far as feasible. This would be necessary to preserve the
essence of dual GST.
 In GST regime, tax (i.e. CGST and SGST/UTGST for intra-State supplies and
IGST for inter-State supplies) shall be paid by every taxable person and in this
regard provisions have been prescribed in the law. However, for providing
relief to small businesses, a simpler method of paying taxes and accounting
thereof is also prescribed, known as Composition Scheme. Along with
providing relief to small-scale business, the law also contains provisions for
granting exemption from payment of tax on specified goods and or services.

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1.4 Rate of Tax:
GST has been structured in a way that essential services and food items are placed in
the lower tax brackets, while luxury services and products have been placed in the
higher tax bracket.
The GST council has fitted over 1300 goods and 500 services under four tax slabs of
5%, 12%, 18% and 28% under GST. This is aside the tax on gold that is kept at 3% and
rough precious and semi-precious stones that are placed at a special rate of 0.25% under
GST.
A total of 81% of all the goods and services fall below or in the 18% tax slab. This
means 7 % of the items come under the exempted list, 14% of the items attract a 5%

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tax, 17% of the items attract a 12% tax, and 43% of the items attract an 18 % tax slab,
while only 19% of the items fall under the highest slab of 28% in the new regime. Below
is a list of some of the products that will be a part of the respective slabs:
Exempted GST Rate Slab (No Tax)
7% goods and services fall under this category. Some of these that are of regular
consumption include fresh fruits and vegetables, milk, butter milk, curd, natural honey,
flour, besan, bread, all kinds of salt, jaggery, hulled cereal grains, fresh meat, fish,
chicken, eggs, along with bindi, sindoor, kajal, bangles, drawing and coloring books,
stamps, judicial papers, printed books, newspapers, jute and handloom, hotels and
lodges with tariff below INR 1000 and so on.
5% GST Rate Slab
14% goods and services fall under this category. Some of these include apparel below
INR 1000 and footwear below INR 500, packaged food items, cream, skimmed milk
powder, branded paneer, frozen vegetables, coffee, tea, spices, pizza bread, rusk,
sabudana, cashew nut, cashew nut in shell, raisin, ice, fish fillet, kerosene, coal,
medicine, agarbatti (incense sticks), postage or revenue stamps, fertilizers, rail and
economy class air tickets, small restaurants, and so on.
12% GST Rate Slab
Edibles like frozen meat products, butter, cheese, ghee, dry fruits in packaged form,
animal fat, sausages, fruit juices, namkeen, ketchup & sauces, ayurvedic medicines, all
diagnostic kits and reagents, cellphones, spoons, forks, tooth powder, umbrella, sewing
machine, spectacles, indoor games like playing cards, chess board, carom board, ludo,
apparels above INR 1000, non-AC restaurants, business class air ticket, state-run
lottery, work contracts and so on attract a 12% GST. 17% of goods and services fall
under this category.

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18% GST Rate Slab
43% of goods and services fall under this category. Pasta, biscuits, cornflakes, pastries
and cakes, preserved vegetables, jams, soups, ice cream, mayonnaise, mixed
condiments and seasonings, mineral water, footwear costing more than INR 500,
camera, speakers, monitors, printers, electrical transformer, optical fiber, tissues,
sanitary napkins, notebooks, steel products, headgear and its parts, aluminum foil,
bamboo furniture, AC restaurants that serve liquor, restaurants in five-star and luxury
hotels, telecom services, IT services, branded garments and financial services and so
on attract an 18% GST.
28% GST Rate Slab
19% of goods and services fall under this category. The rest of edibles like chewing
gum, bidi, molasses, chocolate not containing cocoa, waffles and wafers coated with
chocolate, pan masala, aerated water, personal care items like deodorants, shaving
creams, after shave, hair shampoo, dye, sunscreen, paint, water heater, dishwasher,
weighing machine, washing machine, vacuum cleaner, automobiles, motorcycles, 5-
star hotel stays, race club betting, private lottery and movie tickets above INR 100 etc.
have been clubbed together under the 28% GST slab.
1.5 E-Way Bill
An e-Way Bill is an electronic permit for shipping goods similar to a waybill. It was
made mandatory for inter-state transport of goods from 1 June 2018. It is required to be
generated for every inter-state movement of goods beyond 10 kilometers (6.2 mi) and
the threshold limit of ₹50,000 (US$700).
It is a paperless, technology solution and critical anti-evasion tool to check tax leakages
and clamping down on trade that currently happens on a cash basis. The pilot started on

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1 February 2018 but was withdrawn after glitches in the GST Network. The states are
divided into four zones for rolling out in phases by end of April 2018.
A unique e-Way Bill Number (EBN) is generated either by the supplier, recipient or the
transporter. The EBN can be a printout, SMS or written on invoice is valid. The
GST/Tax Officers tally the e-Way Bill listed goods with goods carried with it. The
mechanism is aimed at plugging loopholes like overloading, understating etc. Each e-
way bill has to be matched with a GST invoice.
Transporter ID and PIN Code now compulsory from 01-Oct-2018.
It is a critical compliance related GSTN project under the GST, with a capacity to
process 75 lakh e-way bills per day.
Intra-State e-Way Bill
The five states piloting this project are Andhra Pradesh, Gujarat, Kerala, Telangana and
Uttar Pradesh, which account for 61.8% of the inter-state e-way bills, started mandatory
intrastate e-way bill from 15 April 2018 to further reduce tax evasion.]
It was
successfully introduced in Karnataka from 1 April 2018. The intrastate e-way bill will
pave the way for a seamless, nationwide single e-way bill system. Six more states
Jharkhand, Bihar, Tripura, Madhya Pradesh, Uttarakhand and Haryana will roll it out
from 20 April 18. All states are mandated to introduce it by May 30, 2018.

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1.6 Input tax credit:
The proposed dual Goods and Service tax (GST) system would be designed in such a
manner that the Central GST chain and the State GST chain would be independent of
each other. This would imply that a dealer would not be able to use the input tax credit
available under the Central GST chain in the State level GST chain. The Central GST
chain is likely to integrate the existing excise duty and service taxes levied at the central
level. The State level GST chain is likely to integrate the current State-level VAT, other
local levies and services tax on certain specific services on which States may get the
powers to levy service tax. There will be full input tax credit in the Central GST chain
and also in the State level chain but there would be no usability of Central GST into the
State-level GST chain. Input tax credit would be allowed only at one chain and no carry
forward of the credit from one chain to the other would be allowed. The structure would
only address the cascading effect only in the respective chain and not in the parallel
one. Cross utilization of credit of CGST between goods and services would be allowed.
Similarly, the facility of cross utilization of credit will be available in case of SGST.
Input credit means at the time of paying tax on output, you can reduce the tax you have
already paid on inputs and pay the balance amount.
Here’s how-
When you buy a product/service from a registered dealer you pay taxes on the purchase.
On selling, you collect the tax. You adjust the taxes paid at the time of purchase with
the amount of output tax (tax on sales) and balance liability of tax (tax on
sales minus tax on purchase) has to be paid to the government. This mechanism is called
utilization of input tax credit.
For example- you are a manufacturer: a. Tax payable on output (FINAL PRODUCT)
is Rs 450 b. Tax paid on input (PURCHASES) is Rs 300 c. You can claim INPUT
CREDIT of Rs 300 and you only need to deposit Rs 150 in taxes.

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Who can claim ITC?
ITC can be claimed by a person registered under GST only if he fulfills ALL
the conditions as prescribed.
a. The dealer should be in possession of tax invoice
b. The said goods/services have been received
c. Returns have been filed.
d. The tax charged has been paid to the government by the supplier.
e. When goods are received in installments ITC can be claimed only when the last lot
is received.
f. No ITC will be allowed if depreciation has been claimed on tax component of a
capital good
A person registered under composition scheme in GST cannot claim ITC.

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1.7 SWOT Analysis of GST
 Strength of GST
1. Collection it will reduce cascading effect of taxes;
2. Compliance cost will reduce;
3. Few numbers of rates;
4. Time saving due to call of Entry, Octroi taxes;
5. Reduction of corruption;
6. Simplification of tax collection and administration;
7. Lower burden of taxes on end consumers;
8. Give edge to the industry on their foreign competitors;
9. Easy flow of resources across the country;
10. Reduction in inflation;
11. Widening tax base and tax of Central as well as State.
 Weaknesses of GST
1. Change in Business software
2. Increase in operating cost of business
3. Policy change during the middle of the year
4. Disruption to business
5. Lack of skilled resources and need for re-skilling
6. This system is very fond of technology, but India is a developing country where
people are not habitual of technology
 Opportunities ofGST
 For Consumer:
(i) Simpler tax system (ii) Reduction in prices of goods and services due to
elimination of cascading (iii) Uniform prices throughout the country (iv)

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Transparency in taxation system (v) Increase in employment opportunities
 For Trade/Industry:
(i) Reduction in multiplicity of taxes (ii) Mitigation of cascading/double taxation
(iii) More efficient neutralization of taxes especially for exports (iv) Development
of common national market (v) Simpler tax regime-fewer rates and exemptions.
 For Central/State Governments:
(i) A unified common national market to boost Foreign Investment and “Make in
India” campaign (ii) Boost to export/manufacturing activity, generation of more
employment, leading to reduced poverty and increased GDP growth (iii) Improving
the overall investment climate in the country which will benefit the development of
states (iv) Uniform SGST and IGST rates to reduce the incentive for tax evasion (v)
Reduction in compliance costs as no requirement of multiple record keeping.
 Threats of GST
Inter-States supply of goods and services are considered as import and IGST will be
applied (1%) in addition to custom duties.
The Central government promised for compensation to loss making States for a period
of 5 years. The compensation will be as: 100% for first 3 years, 75 % for 4th year and
50% for 5th year. So, it is possible that all States does not implement it in effective
manner to get compensation
GST is not friendly with banking sector. Because the cost of goods become cheaper
after GST and it will promote export. Presently, 14% service tax is being levied on
baking transactions. GST will make these transactions more costly. Over and above, in
most of countries banking sector is excluded from GST [4, 15, and 17].
GSTC (Goods and Service Tax Council) will set the benchmark for resolving the
dispute on recommendations of GSTC. It means GSTC will lay down the criteria for
GSTC itself. It is against the principle of naturaljustice.
GST is not a guarantee in itself that it would not be influenced by political parties and
politicians will not use it as a win-loss.

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Threshold limit:
A threshold of gross annual turnover of Rs.10 lakh both for goods and services for all
the States and Union Territories will be adopted with adequate compensation for the
States (particularly, the States in North-Eastern Region and Special Category States)
where lower threshold had prevailed in the VAT regime. After taking into consideration
the interest of small traders and small scale industries and to avoid dual control, it has
been decided that the threshold for Central GST for goods will be Rs.1.5 Crore and the
threshold for services should also be appropriately high.
Selective Concessions/Exemptions:
While a linear tax structure with few exemptions would be ideal, the GST structure is
likely to continue with sector specific concessions and exemptions. It was observed by
Dr. Shome (erstwhile advisor to the finance minister), ‘that shades of policy
interventions is a fact of life and we have to weave such positive suggestions in the
framework and that by 2010, we will have a structure that will overhaul all taxes into
one, of course with some exemptions.’ No tax will be payable on goods and services
which shall be declared as exempted supplies and for such supplies, the assesse will not
be able to claim any input tax credit. However certain supplies may be classified as zero
rated goods and services thereby making it eligible to input tax credit.
Service Tax under GST:
Service Tax is levied at 10.3% (inclusive of Education Cess) percent tax on more than
100 services. States do not levy or collect service taxes at present, but get a share from
the Centre's collections. It is proposed that states will keep the entire collection from
certain services from this year. States would also tax another set of proposed new
services, collect and appropriate as part of compensation for central sales tax phase-out
in 2010. Since there would be issues on taxing cross border services it is expected that
the State GST would only include services that are essentially of "Local Nature". It has
also been reported that Service tax rate under Central GST and State GST is likely to
be uniform. Though State Service Tax proposed to be levied on new local services

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would add to the cost, a redeeming feature is that Input Tax Credit would be eligible on
the State Service Tax and a host of other levies like Entry Tax, Electricity Tax, and
Luxury Tax etc. that would be integrated under State GST. Of course, the service should
qualify as an eligible Input Service.
Tax Base for Dual GST Levy:
Though nothing has been explicitly said on the tax base for the State GST, it has been
reported that the dual GST Structure would ensure that there is no double taxation and
it would help trim the present cascading effect of tax to benefit industry and consumers.
So there is a likelihood that the levy of Central GST and State GST would be on the
same tax base as only this can help trim the present cascading effect of tax.
1.8 Composition/Compounding Scheme
Composition/Compounding Scheme for the purpose of GST will have an upper ceiling
on gross annual turnover and a floor tax rate with respect to gross annual turnover. In
particular, there would be a compounding cut-off at Rs. 50 lakh of gross annual turnover
and a floor rate of 0.5% across the States. The scheme would also allow option for GST
registration for dealers with turnover below the compounding cut-off.
1. Who can opt for Composition Scheme?
A taxpayer whose turnover is below Rs 1.0 crore* can opt for Composition Scheme. In
case of North-Eastern states and Himachal Pradesh, the limit is now Rs 75* lakh.
As per the CGST (Amendment) Act, 2018, a composition dealer can also supply
services to an extent of ten percent of turnover, or Rs.5 lakhs, whichever is higher. This
amendment will be applicable from the 1st of Feb, 2019. Further, GST Council in its
32nd meeting proposed an increase to this limit for service providers on 10th Jan 2019*.
Turnover of all businesses registered with the same PAN should be taken into
consideration to calculate turnover.

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CBIC has notified the increase to the threshold limit from Rs 1.0 Crore to Rs. 1.5
Crores.
2. Who cannot opt for Composition Scheme?
The following people cannot opt for the scheme:
 Supplier of services other than restaurant related services
 Manufacturer of ice cream, pan masala, or tobacco
 A person making inter-state supplies
 A casual taxable person or a non-resident taxable person
 Businesses which supply goods through an e-commerce operator
3. What are the conditions for availing Composition Scheme?
The following conditions must be satisfied in order to opt for composition scheme:
 No Input Tax Credit can be claimed by a dealer opting for composition scheme
 The dealer cannot supply GST exempted goods
 The taxpayer has to pay tax at normal rates for transactions under the Reverse
Charge Mechanism
 If a taxable person has different segments of businesses (such as textile,
electronic accessories, groceries, etc.) under the same PAN, they must register
all such businesses under the scheme collectively or opt out of the scheme.
 The taxpayer has to mention the words ‘composition taxable person’ on every
notice or signboard displayed prominently at their place of business.
 The taxpayer has to mention the words ‘composition taxable person’ on every
bill of supply issued by him.
 As per the CGST (Amendment) Act, 2018, a manufacturer or trader can also
supply services to an extent of ten percent of turnover, or Rs.5 lakhs, whichever
is higher. This amendment will be applicable from the 1st of Feb, 2019. Earlier
the limit was up to Rs 5 lakhs.

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Taxpayer Identification number:
-Each taxpayer will be allotted a PAN inked taxpayer identification number with a total
of13 to15 digits. This would bring the GST PAN-linked system in line with the
prevailing PAN-based system for Income tax, facilitating data exchange and taxpayer
compliance.
Documentation and compliance:
Due to the dual structure of the GST, the assesse will be required to maintain separate
accounts for Central GST and State GST. There will be one periodical return for both
CGST and SGST with one copy each to be submitted to the respective GST authority.
1.9 Goods & Services Tax (GST): Revenue Neutral Rate of Tax
Introduction of GST is an important step in the direction of much awaited tax reforms.
With the passage of the Constitution Amendment Bill, 2014 for in May, 2015,
Government is now all set to implement Goods and Services Tax (GST) by April 2016,
subject to the Bill being passed by the Upper House of Parliament. GST is expected to
be a comprehensive tax, covering most goods and services with minimum exemptions
and will replace the indirect taxes levied by the Central and State Governments.
Once GST is introduced, Central taxes like Central Excise Duty, Additional Excise
Duties, Service Tax, Additional Customs Duty (CVD) and Special Additional Duty of
Customs (SAD), and the State level, taxes like VAT/Sales Tax, Central Sales Tax,
Entertainment Tax, Octroi and Entry Tax, Purchase Tax and Luxury Tax, etc. would
be eliminated.
For the business, GST is expected to be the game changer by simplifying the indirect
tax regime, reforming the Tax Structure, enabling seamless transfer of input tax credit
from one state to another in the chain of value addition, reducing incidence of tax,
simplifying tax computation & Compliance and making tax administration much
easier. GST is also expected to be conducive to development of a common national
market and spurring economic growth.

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From the point of view of Consumers, perhaps the greatest advantage is expected in
terms of an overall reduction in taxes by reducing the cascading effect of taxes on the
cost of goods & services and making the goods & services more competitive.
However, whether these expectations will come true will be decided by the future
events that will unfold with the enactment of GST legislation, prescribed rate of tax and
procedural aspects for availing seamless input credit. Of these, rate of GST will perhaps
be the single most important factor.
Taxation under GST regime:
A crucial factor in GST regime is the rate at which the goods & services are to be taxed.
A sub-committee comprising central and state government officials appointed by the
Government has recommended that the Goods & Services be taxed at a rate of tax which
will be a revenue-neutral rate for the Government. Another important aspect is whether
there will be a single rate of tax for goods & services or whether the goods & services
will be taxed at different rates. In case a single rate of tax is adopted, it may be a lower
rate.
The ultimate decision making for GST rate & exemptions vests with the GST
Council, comprising of the Union Finance Minister, the Minister of State (Revenue)
and the State Finance Ministers.
What is Revenue Neutral Rate (RNR)?
Ordinarily, under the GST regime, revenue of the government would have got affected
due to several features of GST such as: Input Tax Credits & removal of cascading effect
of taxes but would have been compensated by a broader base & increased compliance.
Government, while implementing GST, wants to make sure that there is no reduction
in quantum of its tax revenue. Therefore an adjusted tax rate is being contemplated to
avoid any reduction in revenue of the government. This adjusted rate of tax is the rate
which will ensure that Government revenue remains the same as being realized under
present tax structure. This rate is what has come to be known as “Revenue Neutral
Rate”.

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Is the Revenue Neutral Rate really neutral?
For determining what should be the Revenue Neutral Rate, the National Institute of
Public Finance & Policy had undertaken a study on Revenue Implications of GST and
Estimation of Revenue Neutral Rate. NIPFP has recommended that GST rate should
be same as the combined central and state taxes on Goods at present but it should be
lower than the combined central and state taxes on services.
It is learnt that the sub-committee comprising central and state government officials
had recommended a revenue-neutral rate (RNR) of about 27% under the proposed
GST regime.
At present, the average rate of Excise duty is 12 per cent and average VAT rate is
about 12.5%. The combined tax rate works out to 24.5%. Then, there are purchase
taxes in some states and a central sales tax of two per cent on inter-state movement of
goods. The tax rate of 27% seems to have been arrived at based on these factors but
this logic disregards the fact that Input Tax Credits are allowed in VAT & Excise Duty
in most cases. Then there are also exemptions and negative lists in these tax levies.
Both these factors ought to have been taken in to account. A GST rate as high as 27%
would erode the confidence of business and consumers and may directly affect
compliance. The rate of GST needs to be much lower than what is recommended, even
from the point of view of being really revenue neutral.
GST Rates globally:
According to the KPMG International Cooperative’s Corporate and Indirect Tax Rate
Survey, 2014, covering 132 countries across the globe, Aruba has the lowest indirect
tax rate of 1.5% and the highest rate of GST currently prevalent is at 27% in Hungary,
The survey also reveals that the 10 lowest indirect taxes range from 1.5% to 14% and
the 10 highest tax rates range from 18% to 27%, where Hungary is the only country
with 27% tax rate. Among our Asian neighbors Pakistan, Bangladesh & Sri Lanka has
indirect tax rates of 17%, 15% & 12% respectively.
Adopting a rate of 27% will undoubtedly place India on the highest tax pedestal
in the global scenario, alongside only Hungary.

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Global experience of transition to GST:
It has been seen that countries which started on the road to GST with a relatively lower
rate of tax but with a broad base covering almost all goods & services have had a
successful transition to GST. For example, New Zealand implemented a GST in 1986
with a rate of 10% on a broad base consisting of virtually all goods and services and
gradually hiked it to the present 15%. Similarly, Singapore GST rate was 3% at
inception, which has now been raised to 7%.
1.10 Goods and Service Tax Network
The GSTN software is developed by Infosys Technologies and the Information
Technology network that provides the computing resources is maintained by the NIC.
"Goods and Services Tax" Network (GSTN) is a nonprofit organization formed for
creating a sophisticated network, accessible to stakeholders, government and taxpayers
to access information from a single source (portal). The portal is accessible to the Tax
authorities for tracking down every transaction; while taxpayers have the ability of
connect for their tax returns.
The GSTN's authorized capital is ₹10 crore (US$1.4 million) in which initially the
Central Government held 24.5 percent of shares while the state government held 24.5
percent. The remaining 51 percent were held by non-Government financial
institutions, HDFC and HDFC Bank hold 20%, ICICI Bank holds 10%, NSE
Strategic Investment holds 10% and LIC Housing Finance holds 11%. However, later
it was made a wholly owned government company having equal shares of state and
central government.
Taxes to be subsumed under the GST:
Taxes or levies to be subsumed will be primarily in the nature of indirect taxes, either
on the supply of goods or on the supply of services. It should be part of the transaction
chain which commences with import / manufacture/ production of goods or provision
of services at one end and the consumption of goods and services at the other. The

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subsumation should result in free flow of tax credit in intra and inter-State levels. The
taxes, levies and fees that are not specifically related to supply of goods & services
should not be subsumed under GST. Revenue fairness for both the Union and the States
should also be considered. The following central taxes will be subsumed under the GST:
i. Central Excise Duty
ii. Additional Excise Duties
iii. The Excise Duty levied under the Medicinal and Toiletries Preparation Act
iv. Service Tax
v. Additional Customs Duty, commonly known as Countervailing Duty (CVD)
vi. Special Additional Duty of Customs - 4% (SAD)
vii. Surcharges
viii. Cesses
The following state taxes will also be subsumed under the GST:
i. VAT / Sales tax
ii. Entertainment tax (unless it is levied by the local bodies).
iii. Luxury tax
iv. Taxes on lottery, betting and gambling.
v. State Cesses and Surcharges in so far as they relate to supply of goods and
services.
vi. Entry tax not in lieu of Octroi
1.11 Harmonization of laws and administration
The need for Centre-State and inter-State harmonization is vital under the Dual GST.
The ultimate goal would be a unified base and one set of rules for the two taxes. There
are different mechanisms for achieving this harmonization. Some of them are:
i. In Australia, the GST is imposed and administered as a single unified tax levied
by the national government. All the revenues are from the tax are then
distributed to the states. The tax is a federal tax that is distributed to the States

27
under a political agreement. There venues are distributed as grants to the States,
taking into account factors such as fiscal capacity and need of individual States.
ii. In Canada, the Harmonized Sales Tax (HST) is levied in three of the ten
provinces. The tax is levied and administered under a unified law by the national
government. Under the Canadian system, provincial participation in the HST is
elective and not mandatory. The tax is levied at the national rate of 5 percent
which is increased by 8% percent in those provinces which have elected to
participate in it. The revenues attributable to the supplementary rate of 8 percent
are then distributed among the participating provinces on the basis of a
statistical calculation of the tax base in those provinces (which approximates the
revenues they would have collected if they had levied a separate tax of their
own).
iii. In the European Union, the model of GST is quite different from the Australian
and Canadian models. The focus in the EU model is on minimization of
distortions in trade and competition, and not on harmonization of
administration. Thus, the VAT base(subject to continuing derogations) is
harmonized, as are the basic rules governing the mechanism and application of
VAT (time of supply, valuation, place of supply etc). The administration is
largely a matter for the member states to decide (but must respect the basic
principles such as neutrality). In India the Central Sales Tax offers an interesting
model of the harmonization mechanism. The CST law is central, but the tax is
administered and collected by the States. Indeed, this appears to be most suitable
model for India. The GST law for both the Centre and the States would been
acted by Parliament under this model. It would define the tax base, place of
taxation, and the compliance and enforcement rules and procedures. The rates
for the State GST could be specified in the same legislation, or delegated to the
State legislatures. The legislation would empower the Centre and the States to
collect their respective tax amounts, as under the CST.

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1.12 Key features of GST – An overview:
i. Harmonized system of nomenclature (HSN) to be applied for goods. (As
international trade increased, need was felt to have universal standard system of
classification of goods to facilitate trade flow and analysis of trade statistics.
Hence, International convention of Harmonized System of Nomenclature
(HSN), called Harmonized Commodity Description and Coding System, was
developed by World Customs Organization (WCO). This is an International
Nomenclature standard adopted by most of the Countries to ensure uniformity
in classification in International Trade. HSN is a multipurpose 8 digit
nomenclature classifying goods in 5019 groups of goods.)
ii. Uniform return & collection procedure for central and state GST.
iii. PAN based Common TIN registration. (The Tax Payer's Identification Number
(TIN) is new unique registration number that is used for identification of dealers
registered under VAT. It consists of 11 digit numerals and will be unique
throughout the country. TIN issued for identification of dealers in the same way
like PAN is used for identification of assesses under Income Tax Act.)
iv. Turnover criteria to be prescribed for registration under both central goods and
services tax (CGST) and state goods and services tax (SGST).
v. TINXSYS to track transactions. (Tax Information Exchange System
(TINXSYS) is a centralized exchange of all interstate dealers spread across the
various States and Union territories of India. TINXSYS is an exchange authored
by the Empowered Committee of State Finance Ministers (EC) as a repository
of interstate transactions taking place among various States and Union
Territories. TINXSYS will help the Commercial Tax Departments of various
States and Union Territories to effectively monitor the interstate trade.)
vi. Tax Payment will be by exporting dealer to the account of receiving state.
vii. Credit will be allowed to the buying dealer by receiving state on verification.
viii. Submission of declaration form is likely to be discontinued.
ix. Area based exemptions will continue up to legitimate expiry time both for the
Centre and the States.
x. Product based exemptions to be converted into cash refund.

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xi. Limited flexibility to be given to Centre and States for exceptions like natural
disasters etc.
xii. Simplified structure to reduce transaction cost.
xiii. Separate rules and procedures for the administration of CGST and SGST.
xiv. Specific provisions for issues of dispute resolution and advance ruling.
1.13 Issues/ Challenges in Implementation of Goods and Services
The current challenges:
• GST is meant to simplify the Indian indirect tax regime by replacing a host of taxes
by a single unified tax, thereby subsuming central excise, service tax, VAT, entry tax,
etc. However, there is a plethora of challenges before the government for its successful
implementation. Some of these are highlighted below:
– The GST Constitutional Amendment Bill was passed by the Look Sabha in May 2015.
However, the government faced tremendous political set-backs and failed to get it
passed in the Rajya Sabha during the monsoon and the winter sessions last year.
– Once this is achieved, another Herculean task would be to get the GST Bill passed by
the respective state governments in state assemblies. The government would also be
required to put the GST bill in the public domain and give sufficient time to all
stakeholders to comprehend and give their views on the bill.
– A large part of the success of GST depends on two prominent factors – ‘RNR’ and
‘threshold limit’ for GST. RNR, ie the Revenue Neutral Rate, is the rate at which there
will be no revenue loss to the government after implementation of GST. Needless to
mention, RNR will impact India Inc adversely, if it is unduly higher than the present
tax structure. Based on the study conducted by National Institute of Public Finance and
Policy (NIPFP), RNR was decided at 27 percent. However, recently the Economic

30
Advisor Panel recommended an RNR of 15 percent to 15.5 percent, ie a lower tax rate
of 12 percent and a standard tax rate of 17 percent to 19 percent.
– Further, the threshold limit of turnover for dealers under GST is another bone of
contention between the government and the Empowered Committee, aiming to broaden
the tax base under GST.
– Another factor that will impact the success of GST is the robust IT backbone
connecting all state governments, trade and industry, banks and other stakeholders on
a real-time basis. The government has already incorporated an SPV viz. – Goods and
Services Tax Network (GSTN), which has to develop a GST portal – front-end system
for trade and industry and back-end system for all government agencies. GSTN will
ensure technology support for registration, return filing, tax payment, IGST settlement,
MIS and other dashboards on GST portal to all the stakeholders.
– GST is quite different from the existing indirect taxation system in the country. For
effective implementation of GST, tax administration staff – both at central and state
levels – would require to be trained properly in terms of concept, legislation and
procedure. The tax administration staff would also need to change their mindset,
approach and attitude towards the tax payers. And for this, they would have to ‘learn,
unlearn, and relearn’ the GST not only in letter but in spirit too.
– As per the Constitutional Amendment Bill placed in the Look Sabha, it was proposed
that states would be allowed to levy an additional 1 percent non-vatable tax on inter-
state supply of goods for the initial two years, in order to compensate the states for loss
of revenue while moving to GST. This was supported by a few states, while a few others
criticized the same. However, recently the Empowered Committee recommended
abolition of the additional tax. There is no clarity on the same yet.

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– The taxing events of ‘manufacture under central excise’, ‘sale under VAT’ and
‘provision of service under service tax’ will converge into one taxing event of ‘supply’
under GST, i.e. GST will be levied on the event of supply of goods or services. The
‘Place of Supply Rules’ will thus form an important factor to determine the place of
provision of goods or services.
• These are some of the major challenges before the government and the industry, ahead
of the actual implementation of GST.
The impact:
• GST will be a welcome change for the economy since it is expected to simplify the
indirect tax structure in India. However, it is expected to have far-reaching impact on
businesses. While the Constitution Amendment Bill has not yet been passed, at this
stage, the businesses should prepare for GST by undertaking GST impact assessment
study and have a high-level plan for the GST transition.
• A study by the National Council of Applied Economic Research (NCAER) had
estimated that roll out of GST would boost the India’s GDP growth by 1 percent to 2
percent. Crisil had also reported that GST is the best way to mobilise revenue and
reduce the fiscal deficit. GST has been commonly accepted by more than 140 countries
in the world. Looking at the magnitude, GST is going to impact all sections of the
society – from small time businessmen to huge conglomerates and from a developing
state to a developed state in this country. The implementation of GST will give a boost
to the growth engine pursued by the government.
1.14 Valuation of Non-monetary consideration under Service Tax
The term ‘service’ is defined under service tax law to mean any activity for
‘consideration’ by one person for another. In this regard, it is important to note that

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section 67 of the finance act, 1994 determines consideration to include both monetary
as well as non-monetary consideration. Monetary consideration is the consideration in
the form of money and there are no any disputes on determination of the value for the
same, however, liability of service tax on non-monetary consideration and its valuation
has been a subject matter of dispute. Current article is written to understand the meaning
of the term non-monetary consideration, its coverage, interpretation, practical issues
and best course of action there in.‘ Non-monetary’ consideration essentially means
compensation in kind such as the following:
 Supply of goods and services in return for provision of service;
 Refraining or forbearing to do an act in return for provision of service;
 Tolerating an act or a situation in return for provision of service;
 Doing or agreeing to do an act in return for provision of service.
Statutory provision under section 67 of the finance act states that “in a case, where
the provision of service is for a consideration not wholly or partly consisting of
money, be such amount in money, with the addition of service tax charged, is
equivalent to the consideration”. In simple terms the above statutory provision states
that, in case consideration for the service provided is received in the non-monetary
form then we must check if the value in non-monetary form is ascertainable or is the
same not ascertainable. If the value is ascertainable then the same shall be taken as
the value for the service provided (For ex: ‘X’ provides chartered accountancy
service to ‘Y’ for which ‘Y’ pays 100 grams of gold to ‘X’ as a consideration for the
service provided. In such a case, even though consideration is in the non-monetary
form still the same is ascertainable as the value of gold can be easily available) and
therefore the said ascertained value shall be taken as consideration. However, the real
practical valuation challenges arise in cases where consideration is paid in the non-
monetary form and the value of the consideration is not ascertainable.
For example:
A provides land to B for construction of residential apartments, in return, of which B
provides 40% of the constructed flats to A; (commonly known as Joint Development
agreements)

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A agrees to design B’s house and in return B agrees not to object to construction of
A’s house in his neighborhood. As per section 67(1)(iii), in case where the provision
of service is for the consideration which is not ascertainable, then the value of taxable
service shall be determined in the prescribed manner. In this regard, rule 3 of the
service tax (determination of value) rules, 2006 has been prescribed which provides
as follows:
The value of such taxable service shall be equivalent to the gross amount charged
by the service provider to provide similar service to any other person in the denary
course of trade and the gross amount charged is the sole consideration; Where the
value cannot be determined in accordance with clause (a), the service provider shall
determine the equivalent money value of such consideration, which shall, in no case
be less than the cost of provision of such taxable service. In simple terms, the above
rule states the value shall be determined as follows: Value shall be the “gross
amount charged” for providing the “similar service” to any other person in the
ordinary course of trade; and Further, the above value shall in no case be less than
the cost of provision of such service.
The term ‘similar service’ referred above means a service of similar description
provided under similar circumstances. However, the said expression has not been
defined under the law. Neither there is any relevant judgment on this issue. There are
judgments in relation to the expression ‘similar goods’, for instance, the supreme court
in case of NAT steel Equipment pvt. ltd v/s CCE, has stated that “… The expression
‘similar’ is a significant expression. It does not mean identical but it means
corresponding to or resembling to in many respects; somewhat like; or having a general
likeness. The statute does not contemplate that goods classed under the words of
‘similar description’ shall be in all respects the same. If it did, these words would be
unnecessary…”However, the criteria to determine to interpret the term ‘similar goods’
may not be justifiably used to determine incidence of ‘similar services’ since goods are
tangible in nature and their similarity can be judged by seeing them or by comparing
its characteristics etc. But services are intangible in nature which cannot be seen to
compare it with other services and therefore the determination of monetary equivalent
of non-monetary value remains an arguable issue in case of ‘similar service.The

34
stipulation of similar service being provided in ordinary course of business brings in
the concept of independent persons and arm’s length price, which in substance refers
to the between two unrelated parties. However, practical challenges do exists in
determining whether or not a particular service can be considered as a ‘similar service’
for the purpose of valuation of any other service especially when the law does not
envisages the nature or the degree of similarity to be relied upon. For example:
Can an opinion provided by a chartered accountant on one matter can be considered
as similar to the opinion provided by the same chartered accountant on any other
matter without giving due regard to the time, efforts and complexity involved in the
other opinion?
In case of Joint Development agreements, can the price at which flats are sold to other
customers be applied to the flats sold to the land owners treating the same as ‘similar
service’ especially when they differ in the following aspects:
Flats of landowners and other customers differ in terms of area, location, time of
booking, quality of construction, special services provided if any.
Consideration charged/received from the customer also includes value of undivided
portion of land, whereas the transaction with landowners does not cover any
consideration towards undivided portion of land.
Further value of flat sold to others customer also includes the finance cost unlike in
case of flats sold to land owners. In above cases, although it can be argued that the
word ‘similar’ need not be interpreted as ‘same’ and any similarity shall suffice for
valuation, but such an interpretation only invites for larger consequences as similar
even in the most bleakest sense would entail department to adopt the higher values for
the calculation of the service tax liability, causing undue hardship to the assesse. As
the government envisaged the practical difficulties in ascertaining the value of similar
service, it provided alternate criteria to value the service on the basis of its cost.
However, there is no commonly agreed formula for determining this aspect as well as
to whether it would be on the basis of full costs comprising both direct and indirect
costs or whether it would only extend to direct costs incurred for providing the services.
This is particularly true in relation to determination to the cost of services, as opposed
to determining the cost of supply of goods. However, in the view of the paper writer,
full costs including direct and indirect costs must be considered for the purpose of

35
valuation unless anything to the contrary is provided in the legislation. Therefore,
although the valuation rules have provided two alternate criteria to value a non-
monetary consideration in case of unascertainable value of service, however, the
existing provisions in this regard are not adequate to take care of this aspect.
Conclusion:
In all cases where the value is not ascertainable, assesse may determine the same based
on the service most akin and it is recommended to intimate the same to the department
giving out the detailed calculation of value adopted and the reasons thereof in order to
avoid any departmental disputes at a future date and to safeguard selves from extended
period of limitation and unwarranted penalties on the grounds of suppression, collusion
or miss-representation etc. Also, adjustments can be made for any differences arising
on account of difference in quality of service, timing or any other criteria. Further,
consideration can also be valued based on cost and more often than not the same shall
be more favorable option provided if it can be established that the value in such
circumstances cannot be ascertainable as the services provided are not similar in nature.
It is vital to carve out the distinction and establish that the services are not similar in
nature, once established, and then consideration can be valued based on actual costs
incurred. Further, as a precautionary measure the valuation so adopted shall be
supported by a cost accountants certificate. The last course of action could be to opt for
provisional assessment from the department but the same is usually less favorable
option than others.
1.15 Implications of GST on imports and exports
The new goods and services tax (GST), launched on July 1, 2017, will change how
business is done in India. It is likely to have a significant impact on the international
trade of goods through changes in the structure of import and export taxation, and the
withdrawal of various indirect taxes and exemptions.
In the previous tax system, the imports of goods were subject to import duties such as
custom duty, countervailing duty (equivalent to excise duty), and special additional

36
duty (equivalent to value added tax), and the import of services was subject to service
tax.
Duty and GST on imported goods
Under the reformed tax structure, the integrated goods and services tax (IGST) replaces
the previous indirect taxes imposed on the import of goods and services. Certain
exceptions such as imports of pan masala and petroleum products, however, continue
to attract levy of countervailing duties.
In addition to IGST, customs duty, education cess, and other protective taxes, such as
the anti-dumping duty and safe-guard duty, also continue to be levied on imports of
certain goods – carrying over from the previous tax regime. For the import of services,
only IGST is levied.
Integrated Goods and Services Tax
Imports under GST are treated as inter-state supply. Since GST is a destination-based
tax, Integrated Goods and Services Tax (IGST) is levied in the state where the imported
goods are consumed and imported services are received.
IGST can be paid using input tax credit of central goods and services tax (CGST), state
goods and services tax (SGST), and IGST. Input tax credit is the credit that dealers can
avail for taxes paid on their purchases, at the time of paying final tax on their sales.
In case of CGST and SGST, no cross utilization of input tax credit is allowed. This
means that input tax credit of CGST can only be utilized for CGST and IGST, and input
tax credit of SGST can only be utilized to pay for SGST and IGST.
Import of services under GST
Under GST, the import of service is taxable if –
 The supplier of service is located outside India;

37
 The recipient of service is located in India;
 The place of supply of service is in India; and,
 The supplier of service and the recipient of service are not merely
establishments of a distinct person.
Tax returns
An importer is required to file monthly tax returns under GST. Under the previous law,
the importer was required to file returns under state tax law for purchase of goods
(import of goods) and under central tax laws for claiming countervailing duties.
While filing monthly returns, importers must declare the goods imported in table-5 of
the GSTR-2 form, and services imported in table-6 of the GSTR-2 form.
Exemptions
Previously, the transportation of goods by aircraft and inbound shipment was not liable
to service tax. Under GST, there is no such exemption.
Impact on exports
Under GST, exports are treated as ‘zero-rated supplies’. If GST is paid at any point of
supply against exports from India, a trader may either export without the payment of
IGST under bond or letter of undertaking, or may pay the IGST and claim refund
later. In both cases, an exporter must provide details of GST invoices in the shipping
bill.
System of Zero rating
The system of zero rating ensures that the benefit of zero rating is availed only after
satisfaction of the condition that the tax is paid in the importing state. The dealer in the
importing state will capture the inter-state procurements in the periodic return and pay
the relevant tax on such procurements. In case the liability to pay tax is not discharged
within the stipulated time, zero rating will be reversed and then the seller in the
exporting state will be required to pay the tax. For the successful implementation of the
system of zero rating with pre-payment, a reliable mechanism should be put in place to
identify inter-state transactions and thereby ensure that there is no evasion of taxes.
Exports would be zero-rated. Similar benefits may be given to Special Economic Zones

38
(SEZs). However, such benefits will only be allowed to the processing zones of the
SEZs. No benefit to the sales from an SEZ to Domestic Tariff Area (DTA) will be
allowed.
Taxation of certain goods:
Certain goods like alcoholic beverages, tobacco and petroleum are subject to higher rate
of taxes as it attracts multiple taxes like excise duties, license fees, cess, inter-state
import and export fees etc. This is mainly done to discourage the consumption of such
products. Alcoholic beverages would be kept out of the purview of GST. Sales
Tax/VAT can be continued to be levied on alcoholic beverages as per the existing
practice. In case it has been made Vatableby some States, there will be no objection to
that. Excise Duty, which is presently being levied by the States will also not be affected.
Tobacco products will be subjected to GST with Input Tax Credit (ITC). Centre may
also be allowed to levy excise duty on tobacco products over and above GST without
ITC. Petroleum products, i.e. crude, motor spirit (including ATF) and HSD would be
kept outside GST as is the prevailing practice in India. Sales Tax could continue to be
levied by the States on these products with prevailing floor rate. Similarly, Centre could
also continue its levies. Whether natural gas will be within the purview of GST or not
has not yet been decided.
Inter-state transactions of Goods and Services:
Integrated GST (IGST) model for taxation of inter-state transaction of goods and
services has been adopted. According to this model, Centre would levy IGST which
would be CGST plus SGST on all inter-State transactions of taxable goods and services
with appropriate provision for consignment or stock transfer of goods and services. The
inter-State seller will pay IGST on value addition after adjusting available credit of
IGST, CGST, and SGST on his purchases. The Exporting State will transfer to the
Centre the credit of SGST used in payment of IGST. The Importing dealer will claim
credit of IGST while discharging his output tax liability in his own State. The Centre
will transfer to the importing State the credit of IGST used in payment of SGST. The

39
relevant information will also be submitted to the Central Agency which will act as a
clearing house mechanism, verify the claims and inform the respective governments to
transfer the funds.
The major advantages of this model are:
Maintenance of uninterrupted input tax credit chain on inter State transactions. No
upfront payment of tax or substantial blockage of funds for the inter-State seller or
buyer. No refund claim in exporting State, as ITC is used up while paying the tax. Self-
monitoring model. Level of computerization is limited to inter-State dealers and
Central and State Governments should be able to computerize their processes
expeditiously. As all inter-State dealers will be e-registered and correspondence with
them will be by email, the compliance level will improve substantially. Model can take
'Business to Business' as well as 'Business to Consumer' transactions into account.

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CHAPTER NO.2 RESEARCH METHODOLOGY
2.1 Objective of the Study 41
2.2 Type of Research 41
2.2 Scope of the GST 41
2.3 GST Benefits 42-43
2.4 Limitation of Study 43
2.5 Significance of Study 44
2.6 Need for Goods and Service Tax in India 44-45

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2.1 Objectives of the Study
1. To understand the concept of GST.
2. To understand the working of GST.
3. To study the issues related to GST in India.
4. To know about E-way bill.
2.2 Type of Research
 Exploratory Research
Both primary and secondary data have been collected to meet our objectives. The
research would be conducted from the source of primary data collection. Secondary
data would help us in knowing about GST and would help us in analyzing
and interpretation of the primary data.
Primary Data – Questionnaire.
Secondary Data – Internet, Newspaper, books and Business Magazines.
2.3 Scope of the Study
The scope of the project limits up to the study of GST under Indirect Tax System. GST
shall cover all goods and services, except alcoholic liquor for human consumption, for
the levy of goods and services tax. In case of petroleum and petroleum products, it has
been provided that these goods shall not be subject to the levy of Goods and Services
Tax till a date notified on the recommendation of the Goods and Services Tax Council.
Of Goods and Services Tax Council to examine issues relating to goods and services
tax and make recommendations to the Union and the States on parameters like rates,
exemption list and threshold limits. The Council shall function under the Chairmanship
of the Union Finance Minister and will have the State Union Minister as its members.

42
2.4 GST Benefits
1. For Consumers or Common Man:
The biggest advantage for common man would be in terms of a reduction in overall
tax burden on goods. All taxes that are currently exist will not be Exist anymore. This
means current Taxes like Excise, Octroi, sales tax, CENVAT, service tax, turnover tax
etc. will not be applicable and all that will fall under common tax called as GST. So it
helps Common man to save more money through GST.
2. For Business point of View:
GST will be boon for business man. No multiple taxes means compliance and
Documentation will be easy. Return filing, tax payment and refund process will be easy
and hassle free. There are many other Advantages for Manufacturers and Traders are:-
i. Common Market-
There will be common market in the absence of CST and entry tax. At present, goods
are being sold mostly within the state in order to avoid paying the CST which is not
credited at the stage of manufacture or in course of trading. Good quality products
being manufactured in one part of the country will find more market on the farthest
part of the country because there will be no cost and no entry tax.
ii. Difference between Goods and Services will go-
In some cases, there is distinction between goods and services when they are sold as
a package. These controversies will go.
iii. Invoicing will be simpler-
At present, the invoices are more detailed since taxes on goods and services are written
separately for one transaction. With the introduction of GST only one rate will be
written.
iv. Cost Reduce- The suppliers, manufacturers, wholesalers and retailers are able to
recover GST in cured on input costs as tax credits. This reduces the cost of doing

43
business, thus enabling fairer prices for consumers.
Some Common Benefits of GST are:-
Number of Tax Department will reduce which in turn may lead to less
corruption. Helps in Reducing Corruption-Effectiveness- GST is more
comprehensive, effective, transparent, and business friendly tax system. So
overall we can say that, GST is expected to bring a no. of benefits to the Indian
economy. It is also important for businesses to start gearing themselves for
GST.
They should evaluate their present business scenarios and brainstorm what
kind of changes GST will bring to their business. As and when the Government
gives an opportunity to the industry, they should be ready with their
representations and suggestions. Further, since GST is expected to completely
transform the way business is done, the respective teams should be
communicated about the transition, like IT, finance, Compliance, supply
chain, pricing, procurement etc.
For Example:-The IT teams should be prepared for changing the IT infrastructure in
alignment with GST like change in the invoice formats, accounting records etc.
2.5 Limitation of Study
Howsoever impeccable a thing may seem to be there always dwell some
possibilities of failure and incompleteness. The result of this work also
subjects to some of limitations, which are as follows:
 Some respondents were not interested in giving answer and they
appeared to be busy.
 Lack of experience.
 Lack of available and reliable data.
 Measure used to collect data was not so satisfactory.

44
2.6 Significance of Study
 Through this study of GST I have acquired a lot of knowledge regarding how
the flow of black money has been reduced.
 It has made me understand how this revolutionary change was beneficial to the
entire country.
 The removal of Indirect Taxes has made all the transactions in an organized
manner not leading confusion.
 It is helping India to do everything on a Single Click.
 GST is probably one of the most positive and transformational change in the tax
structure of India. It would expected to trigger our economy to a great growth.
2.7 Need of Study
There is a saying in Kautilaya's Arthshastra, the first book on economics in the world,
that the best taxation regime is the one which is "liberal in assessment and ruthless in
collection". The proposed GST seems to be based on this very principle.
Firstly, while the present system allows for multiplicity of taxes being collected through
an inefficient and non-transparent system, the introduction of GST is likely to
rationalize it and thereby plug the loop holes in this system. This will enable the
government to stop pilferage and rationalize the overall taxation regime. While many
areas are either under-taxed or non-taxed or over-taxed, the GST will help reduce
overall tax burden of many organizations. Introduction of an integrated Goods and
Services Tax (GST) to replace the existing multiple tax structures of Centre and State
taxes is not only desirable but imperative in the emerging economic environment.
Increasingly, services are used or consumed in production and distribution of goods and
vice versa. Separate taxation of goods and services often requires splitting of

45
transactions value into value of goods and services for taxation, which leads to greater
complexities, administration and compliances costs. Further, Indian economy is getting
more and more globalized. In recent times, a number of Free Trade Agreements (FTAs)
have been signed, which will allow imports into India duty free or at very low duties.
Hence, there is need to have a nation-wide simple and transparent system of taxation to
enable the Indian industry to compete not only internationally, but also in the domestic
market. Integration of various Central and State taxes into a GST system would make
it possible to give full credit for inputs taxes collected. GST being a destination-based
consumption tax based on VAT principle, would also greatly help in removing
economic distortions caused by present complex tax structure and will help in
development of a common national marked.
A basis pre-requisite for introduction of GST meaningfully is that both the Centre and
the State should replace existing taxes like Excise, State Sales Tax/ VAT, CST, Entry
Tax and all other cascading-type Central/ State levies on goods and services. Any losses
on account of abolition of multiple taxes are likely to be balanced by the additional GST
revenues that will obtain from taxation of services and from access to GST on imports.
Moreover, India would obtain full efficiencies of a single national VAT, while retaining
a federal structure. This would also be the logical conclusion of the efforts that have
been made in the country during last 2 decades in moving towards VAT.
The benefits of GST legislation will be uniformity of laws across the board, greater
transparency, neutrality in tax rates on various products; credit availability on interstate
purchases and reduction in compliance requirements. If GST is implemented in the true
spirit, it will have many positives for the stakeholders and will lead to a better tax
environment.

46
CHAPTER NO.3 Literature Review
3.1 Articles Related to GST
WILLGSTINCREASEGOVTREVENUE?
By
Prof Datuk Dr John Antony Xavier
The risk in introducing an unpopular tax such as the GST includes fears that it may
shrink consumption and stall growth if consumers are spooked by it. Take fright with
the unveiling of the 2014 Budget, the long-awaited goods and service tax has at last
come knocking at our doors Come April 2015, the will replace the service and sales
taxes (SST). Previously, we predicted that the rate would be between six and 10 per
cent, the former being the current service tax rate while the latter is the sales tax rate.The
common expectation was that the would be four per cent on the supposition that that
rate would be revenue neutral. That is, the revenue from the will just offset the revenue
lost from the repeal of the SST. By setting it at six per cent, or one per cent lower than
that of Singapore and Thailand, the government has to showcase our as the lowest in
Asean. There is always a risk in introducing an unpopular tax. The fear is that it may
shrink consumption and, consequently, stall growth if consumers take fright. When a
two per cent rise in a similar value-added tax (VAT) took the rate to five per cent in
Japan in 1997, the nation slipped into a recession. And, the premier lost his job! It
would, however, be disingenuous to attribute this unfortunate turn of events entirely to
the VAT increase. Other knock-on effects such as the Asian financial crisis and Japan's
notorious 50 per cent corporate income tax rate then (it has since been brought down to
40 per cent) had a part in dispatching Japan to the doldrums. With our economy
expected to post a modest five per cent growth, the risk of a recession is negligible.
More so, government expenditure is expected to remains table, if not increase, as the
year wears on. Reduction in personal income taxes, the RM2, 000 tax reliefs for those
with monthly incomes of up to RM 8,000 and the RM300 for households who are
BR1M recipients, should have the Keynesian effect of increasing the overall propensity
to consume in the economy. Such increased consumption should spur economic growth

47
and further fill government coffers through the .So; will the proposed bring in the
expected increase in government revenue? We consider that at the proposed rate of six
per cent, the impact on the government’s treasury will be minimal. Let us do the math.
The base, that is, the total amount of goods and services that will be subject to tax will
often range from one-third to one-half of the gross domestic product (GDP). The2014
Budget outlines massive exemptions from the These include 40 essential food items,
public services, public transport, highway toll, sale and lease of residential property,
private education, health, electricity, water and selected financial services. Further,
some products will only attract half the rate. Also, some 80 percent of businesses, that
is those with sales of less thanRM500, 000, will be excluded from the system. So, it is
fair to adopt a base of one-third. With GDP at RM1.051 trillion (accounting for the five
per cent growth rate), of six per cent will raise RM21 billion in tax revenue. This may
seem as a lot of money. But offset that against the loss of RM16billion from the sales
and services taxes (SST), the net amount will be RM5 billion. In keeping with
international practices, the government has brought down corporate and personal
income taxes. There is now a one percent slashes of corporate income tax rate and a
one to three per cent reduction in individual income tax rate. Additionally, the
chargeable income subject to the maximum marginal tax rate has been increased from
exceedingRM100, 000 to exceeding RM400, 000.Combined with the special tax relief
of RM2,000 for taxpayers with a monthly income of up to RM8,000, all these
reductions will conservatively shave off RM1 billion (or one per cent) from the RM127
billion revenue from corporate and individual income taxes. The net proceeds from the
will then only amount to RM4 billion or two per cent of the total government revenue.
Nevertheless, it will reduce the fiscal deficit by 11 per cent. However, the has the
potential to net more revenue as the rate is increased in the years to come. This gradual
increase of the has been the norm among one-third of the countries applying a similar
consumption tax. Even here, the potential for expanding government revenue is limited
as any rate increase may be contingent upon decreases in direct income tax rates. This
is so as, even with cuts of one per cent in corporate income tax rate to 24 per cent, and
the reduction of the maximum personal income tax rate to 25 per cent, threats are
nowhere near those of Singapore. There, the corporate tax rate is 17 per cent while the
maximum personal income tax rate is 20 per cent. These rates are among the lowest in

48
the world. Even the cash- starved United Kingdom has proposed to reduce its corporate
tax rate to 20 per cent by 2015, although one must hasten to add that the VAT in the
UK is 20 per cent on most goods. So, the presumption is that the government will
continue to cut the direct income tax rates even as it increases the in the future. The at
six per cent is an acceptable start. Its impact on government coffers will only be
significant when the rate is increased gradually in the future. Assuming all things are
constant, the real impact on government revenue will be felt at 10 per cent, the
maximum rate in Asian. At that rate, the gas will draw in RM19 billion net, after
factoring in the RM16 billion lost from abolishing the SST, and halve the budget deficit.
Then, we shall be within striking distance of a balanced budget by2020. With a little
belt-tightening, we should by then be safely "home".
New Straits Times,
29 MARCH 2016

49
CHAPTER NO.4 Data Analysis, Interpretation and Presentation
4.1 Data Analysis & Interpretation 50-60
4.2 Findings 61

50
4.1 Data Analysis & Interpretation
1. Have you ever heard about GST?
Option Frequency Percent
Yes 96.03 99%
No 0.97 1%
Interpretation
As per the above figure we can conclude that 99% Responded have heard
above GST, whereas only 1% Responded are unaware about GST.

51
2. Do you think will GST be easy or difficult to comply with?
Easier 56.551 58.3%
Difficult 10.088 10.4%
Not Sure 30.361 31.3%
Interpretation
As per the above figure we can conclude that 58.3% of the Responded feel
that GST is easier to comply with, whereas 31.3% are not sure and only
10.4% find it difficult to comply with.

52
3. Do you think transition to GST regime was?
Smoother 54.611 56.3%
Difficult 38.412 39.6%
Very Difficult 3.977 4.1%
Interpretation
As per the above figure we can conclude that 56.3% Responded transition
to GST regime was smoother, whereas 39.6% Responded find it difficult
for transition and 4.1% Responded find it very difficult.

53
4. Are you facing any significant issues in compliance with e-way bill
mechanism?
Yes 26.287 27.1%
No 48.5 50%
Not Applicable 22.213 22.9%
Interpretation
As per the above figure we can conclude that 50% Responded don’t face
significant issue in compliance with e-way bill mechanism, whereas 27.1%
face issue in compliance with E-way bill and 22.9% are not applicable for
compliance with E-way bill.

54
5. Are you facing issues in claiming refund under the GST regime?
Yes 26.016 27.1%
No 48 50%
Not Applicable 21.984 22.9%
Interpretation
As per the above figure we can conclude that 46.3% Responded are not
facing issue in claiming refund under the GST regime, whereas 28.4%
Responded are not applicable for refund and 25.3% are facing issue for
claiming refund under GST regime.

55
6. Do you feel advance ruling mechanism under GST regime bring in
friendly environment to business?
Yes 82.848 86.3%
No 13.152 13.7%
Interpretation
As per the above figure we can conclude that 86.3% finds ruling
mechanism under GST regime bring in friendly environment to business,
whereas 13.7% do not find friendly environment to business

56
7. What are the key changes you would like to make in GST law to
make it more taxpayer friendly?
GST Rate 54.611 56.3%
Input Tax credit 14.162 14.6%
Returns 13.095 13.5%
E-way bill Offers 15.132 15.6%
Interpretation
As per the above figure we can conclude that 56.3% Responded wants
changes in GST Rate, whereas 15.6% Responded wants changes in E-way
bill, whereas 14.6% Responded wants changes in Input Tax Credit and
13.5% Responded wants changes in returns.

57
8. GST will boost up economic unification of India; it will assist in
better conformity and revenue resilience; it will evade the
cascading effect in Indirect tax regime?
Strongly Agree 26.304 27.4%
Agree 51.552 53.7%
Neither Agree nor Disagree 17.184 17.9%
Disagree NIL NIL
Strongly Disagree 0.96 1%

58
Interpretation
As per the above figure we can conclude that 53.7% Responded agree that
it will evade the cascading effect in Indirect tax regime, whereas 27.4%
Responded Strongly Agree it will evade the cascading effect in Indirect tax
regime, whereas 17.9% neither agree nor disagree and 1% Strongly
Disagree.

59
9. Do you think that matching of ITC is useful to the taxpayer as it
can avoid dispute in future?
Yes 81.985 86.3%
No 13.015 13.7%
Interpretation
As per the above figure we can conclude that 67% Responded finds that
matching of ITC is useful to the taxpayer as it can avoid dispute in future
and 33% say no.

60
10.Do you think Introduction of GST has reduced the flow of black
money in Indian Economy?
Yes 83.711 86.3%
No 13.289 13.7%
Interpretation
As per the above figure we can conclude that 76% Responded feel that
introduction to GST has reduced black money in India, whereas 13.5% are
not sure that it has reduced black money and 10.4% feel that it will not
reduce black money.

61
4.2 FINDINGS:
1. GST (Goods & Services Tax), which is also known as VAT or the value added
tax in many countries is a multi-stage consumption tax on goods and services.
GST is levied on the supply of goods and services at each stages of the supply
chain from the supplier up to the retail stage of the distribution. Even though
GST is imposed at each level of the supply chain, the tax element does not
become part of the cost of the product because GST paid on the business inputs
is claimable.
2. The illustration shown below indicates, in terms of a hypothetical example with
a manufacturer, one wholesaler and one retailer, how GST will work. Let us
suppose that GST rate is 10%, with the manufacturer making value addition of
Rs.30 on his purchases worth Rs.100 of input of goods and services used in the
manufacturing process. The manufacturer will then pay net GST of Rs. 3 after
setting-off Rs. 10 as GST paid on his inputs (i.e. Input Tax Credit) from gross
GST of Rs. 13. The manufacturer sells the goods to the wholesaler. When the
wholesaler sells the same goods after making value addition of (say), Rs. 20, he
pays net GST of only Rs. 2, after setting-off of Input Tax Credit of Rs. 13 from
the gross GST of Rs. 15 to the manufacturer. Similarly, when a retailer sells the
same goods after a value addition of (say) Rs. 10, he pays net GST of only Re.1,
after setting-off Rs.15 from his gross GST of Rs. 16 paid to wholesaler. Thus,
the manufacturer, wholesaler and retailer have to pay only Rs. 6 (= Rs. 3+Rs.
2+Re. 1) as GST on the value addition along the entire value chain from the
producer to the retailer, after setting-off GST paid at the earlier stages. The
overall burden of GST on the goods is thus much less. This is shown in the table
below. The same illustration will hold in the case of final service provider as
well.
3. A major problem with VAT is the way it taxes inputs and outputs. Inputs are
taxes at 4% and outputs at 12.5%. Some good are included in both CENVAT
and VAT. It is not uniform in nature. VAT is different for different states.
Number5 of exemption for some sensitive. Different rates of taxation for
different goods

62
CHAPTER NO.5 Conclusion & Suggestion
5.1 Conclusion 63
5.2 Suggestion 64

63
5.1 Conclusion
Goods and Service Tax, with end-to-end IT-enabled tax mechanism, is expected to
bring buoyancy to government revenue. It is expected that the malicious activity of tax
theft will go away under Goods and Service Tax regime in order to benefit both
governments as well as the consumer.
GST will give more relief to industry, trade and agriculture through a more
comprehensive and wider coverage of input tax set-off and service tax set-off,
subsuming of several Central and State taxes in the GST and phasing out of CST. The
transparent and complete chain of set-offs which will result in widening of tax base and
better tax compliance may also lead to lowering of tax burden on an average dealer in
industry, trade and agriculture. The subsuming of major Central and State taxes in GST,
complete and comprehensive setoff of input goods and services and phasing out of
Central Sales Tax (CST) would reduce the cost of locally manufactured goods and
services. This is likely to increase the competitiveness of Indian goods and services in
the international market and to boost Indian export.
GST or Goods and Service tax will include a uniform rate of taxation in all respect and
would allow an implementation of an access link from the primary producer of goods
and service to the retailer’s stage and will also eradicate all cascading effects in such
process.

64
5.2 Suggestion
Some suggestions for better administrative way to handle and of goods and service tax
act in India are: -
• Standardization of systems and procedure
• Tax relief in case of branch transfer
• Well defined procedures in case of job works
• Uniform dispute settlement procedure
• Adequate training for both tax payers and tax enforcers
• Re-organization of administrative machinery for GST
• Building information technology backbone – the single most important
initiative for GST Uniform implementation of GST should be ensured
across all states (unlike the staggered implementation of VAT) as many
issues might arise in case of transactions between states who comply
with GST and states who are not complying with GST.

65
Bibliography
1. https//.caclubindia.com/articles/valuation-of-non-monetary-consideration-
under-service-tax- 25094.asp
2. https//.caclubindia.com/articles/gst-impact-on-supply-chain-management-
25306.asp
3. https//.caclubindia.com/articles/indian-gst-from-2016-is-it-all-set--25106.asp
4. https//.caclubindia.com/articles/goods-services-tax-gst-revenue-neutral-rate-
of-tax-25529.asp
5. https//.caclubindia.com /articles/how-gst-play-a-significant-role-in-economy-
25515.asp
6. https://en.wikipedia.org/wiki/Goods_and_Services_Tax_%28India%29_Bill
7. https://cleartax.in/s/benefits-of-gst-advantages-disadvantages
8. https://docs.google.com/forms/d/1fhaUVZ3OM_PaTFPlvEZnxJdHaFkylGAD
VlDBgkWEo1M/edit

66
Annexure
QUESTIONNNAIRE
1. Have you ever heard about GST?
o Yes
o No
2. Do you think will GST be easy or difficult to comply with?
o Easier
o Difficult
o Not sure
3. Do you think transition to GST regime was?
o Smoother
o Difficult
o Very Difficult
4. Are you facing any significant issues in compliance with e-way bill
mechanism?
o Yes
o No
o Not applicable
5. Are you facing issues in claiming refund under the GST regime?
o Yes
o No
o Not applicable

67
6. What are the key changes you would like to make in GST law to
make it more taxpayer friendly?
o GST Rate
o Input Tax Return
o Returns
o E-way bill Offers
7. Do you feel advance ruling mechanism under GST regime bring in
friendly environment to business?
o Yes
o No
8. Do you think that matching of ITC is useful to the taxpayer as it
can avoid dispute in future?
o Yes
o No
9. GST will boost up economic unification of India; it will assist in
better conformity and revenue resilience; it will evade the
cascading effect in Indirect tax regime.
o Strongly agree
o Agree
o Neither Agree nor Disagree
o Disagree
o Strongly Disagree

68
10. Do you think Introduction of GST has reduced the flow of black money in
Indian Economy?
o Yes
o No
o Not Sure

Introduction to Goods and Services Tax in India

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