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GST PPT presentaion

  1. TOPIC: Goods and Service Tax (GST)
  2. INDEX Serial No. Topic 1 What is GST? 2 History of GST in India 3 How GST works? 4 Components of GST 5 Who are liable to register under GST? 6 Rate Slabs under GST 7 Requirements to opt for Composition Scheme 8 Input Tax Credit 9 How user can avail Input Tax Credit 10 Advantages of GST 11 Disadvantages of GST 12 Conclusion
  3. What is GST?  Indirect Tax which has replaced many indirect taxes in India.  Passed in the Parliament on 29th March 2017.  Came into effect on 1st July 2017.  Comprehensive, Multi Stage, Destination Based Tax levied on every value addition.  One Indirect Tax for the entire country.
  4. History of GST in India 2000: PM Vajpayee set up a Committee to draft GST law. 2004: Task Force concludes GST must be implemented to improve tax structure. 2006: Finance Minister proposes GST introduction from 1st April 2010. 2007: CST to be phased out. Rates reduced from 4% to 3%. 2008: EC finalizes dual GST structure to have separate levy, legislation. 2010: Project to computerise commercial taxes launched but GST implementation postponed. 2011: Constitution Amendment Bill to enable GST law introduced. 2012: Standing Committee begins discussion on GST but stalled it over clause 279B. 2013: Standing Committee tables it report on GST. 2014: GST bill introduced in Parliament by Finance Minister. 2015: GST bill passed in Lok Sabha but not in Rajya Sabha. 2016: GSTN goes live. 2016: Amended Model GST law passed in both houses. President gives Assent. 2017: Four supplementary GST bills passed in Lok Sabha and approved by cabinet. Rajya Sabha passes four supplementary GST bills. Final GST to be implemented on July1, 2017. GST is launched on July 1, 2017.
  5. How GST Works? GST is levied on each stage as the goods and services reaches from Manufacturer to Final Consumer i.e. GST is levied on every value addition made in the goods and services at each stage. Illustration: Buying Raw Materials Manufactures Goods Sale to Wholesale/ Warehousing Sale to Retailers Final Sale to Consumers GST will be levied on every stage on the value made by each party in the supply chain i.e. monetary worth added at each stage to achieve final sale to the customer.
  6. COMPONENTS OF GST Sale Within the State CGST SGST Sale to Another State IGST CGST: Collected by Central Government on an Intra-State sale. SGST: Collected by State Government on Intra-State sale. IGST: Collected by Central Government for Inter-State sale.
  7. Who is liable to register under GST? • Any business whose turnover in a financial year exceeds Rs 20 lakhs. • Every Person who is registered under earlier law (i.e. VAT, Excise, Service Tax etc.). • Anyone who drives inter-state supply of goods. • Casual Taxable Person. • Non-Resident taxable person. • Agents of a supplier. • E-commerce operator or aggregator. • Person who supplies via e-commerce aggregator.
  8. Rate Slabs under GST The table below shows GST tax rate on some common items- Tax Rates Products 5% Household necessities such as edible oil, sugar, spices, tea, and coffee (except instant) are included. Coal, Mishti/Mithai(Indian Sweets) and Life saving drugs are also covered under this GST slab. 12% This includes computers and processed food 18% Hair Oil, Toothpaste and Soaps, Capital goods and industrial intermediaries are covered in this slab. 28% Luxury items such as small cars, consumer durable like AC and Refrigerators, Premium Cars, Cigarettes and aerated drinks, High-end motorcycles are included here.
  9. Requirements to opt for composition scheme • Any Business having annual turnover up to Rs 1 crore. • Only Manufacturers of goods, Dealers, and Restaurants(not serving alcohol) can opt for composition scheme. • No need to maintain detailed records. • Cannot avail Input Tax Credit. • Cannot issue Tax invoice but should issue Bill of Supply. • Furnish only one return (GSTR-4) on quarterly basis and an annual return in form GSTR-9A. • Composition Dealer cannot collect GST from the buyer. • Should be supplying goods Intra-State. Composition Scheme- Applicable GST Rate Type of Business CGST SGST Total Manufacturer and Traders (Goods) 0.5% 0.5% 1% Restaurants not serving alcohol 2.5% 2.5% 5% Service Providers are not eligible for Composition Scheme
  10. Input Tax Credit Supplier at the time of paying GST to the government can avail benefit of GST he paid at the time of purchasing inputs or raw material. In simple words, Input Tax Credit= GST collected at the from the consumer at the time of sale (-) GST paid on the purchase of inputs and raw materials Input Tax Credit= Tax collected by the supplier at the time of sale of goods or providing the services(-) Tax paid at the time of purchase of inputs or raw materials A •Tax paid on purchase of A Rs 100 B •Tax paid on purchase of B Rs 120 C •Tax paid on Purchase of C Rs 80 Output Input Tax on output Rs 450 Tax to be paid by manufacturer= Rs 450 less Tax paid on inputs (Rs 100 + Rs 120 + Rs 80)= Rs 150 Input Credit = Rs 300
  11. How user can avail Input Tax Credit • Use input tax credit from IGST,CGST,SGST paid on purchases.To pay IGST • Use input tax credit from CGST & IGST paid on purchases.To pay CGST • Use input tax credit from SGST & IGST paid on purchases.To pay SGST NOTE:  User cannot use CGST input tax credit to pay SGST liability.  User cannot use SGST input tax credit to pay CGST liability.
  12. Advantages of GST Removing Cascading effects Regulating the Unorganized Sector Composition scheme for small businesses Online simpler procedure under GST Higher threshold for Registration Lesser Compliances Defined treatment of e-commerce Increased efficiency in logistics
  13. Increased Cost due to software purchase Being GST Compliant GST will mean an Increase in operational costs GST is an online taxation system SMEs will have a higher tax burden Disadvantages of GST
  14. Conclusion • Change is definitely never easy. • Government is trying to smoothen the road to GST. • Will benefit in the long run. • Paper work has become less than previous tax regime as GST is online taxation system. • Unified Tax system and easy input tax credits.