The goods and services tax (GST) is a value-added tax levied on most goods and services sold for domestic consumption.

1. INTRODUCTION TO GST
Ramya B
Assistant Professor
B.com(PA)
Sri Ramakrishna College of Arts and Science
Coimbatore - 641 006
Tamil Nadu, India
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2. GOODS AND SERVICES TAX
• The goods and services tax (GST) is a value-added tax levied on most goods and
services sold for domestic consumption. The GST is paid by consumers, but it is
remitted to the government by the businesses selling the goods and services.The
goods and services tax (GST) is an indirect federal sales tax that is applied to the
cost of certain goods and services.
• The business adds the GST to the price of the product, and a customer who buys
the product pays the sales price inclusive of the GST. The GST portion is collected
by the business or seller and forwarded to the government. It is also referred to
as Value-Added Tax (VAT) in some countries.

3. History Of GST
• On July 1st 2017, the Goods and Services Tax implemented in India. But, the process of
implementing the new tax regime commenced a long time ago. In 2000, Atal Bihari Vajpayee,
then Prime Minister of India, set up a committee to draft the GST law. In 2004, a task force
concluded that the new tax structure should put in place to enhance the tax regime at the time.
• In 2006, Finance Minister proposed the introduction of GST from 1st April 2010 and in 2011 the
Constitution Amendment Bill passed to enable the introduction of the GST law. In 2012, the
Standing Committee started discussions about GST, and tabled its report on GST a year later. In
2014, the new Finance Minister at the time, Arun Jaitley, reintroduced the GST bill in Parliament
and passed the bill in Lok Sabha in 2015. Yet, the implementation of the law delayed as it was
not passed in Rajya Sabha.

4. • GST went live in 2016, and the amended model GST law passed in both
the house. The President of India also gave assent. In 2017 the passing
of 4 supplementary GST Bills in Lok Sabha as well as the approval of
the same by the Cabinet. Rajya Sabha then passed 4 supplementary GST
Bills and the new tax regime implemented on 1st July 2017.

5. Main Features of GST
• The Goods and Services Tax (GST) is a national indirect tax that applies to the manufacture, sale,
and consumption of goods and services in India.
• The GST takes the place of various taxes imposed by the federal and state governments.
• Applicable on the supply side, GST is levied on the supply of goods or services, as opposed to
the manufacturing, selling, and providing services.
• GST is founded on the principle of destination-based consumption taxation, as opposed to the
current approach of origin-based consumption taxation.
• The 101st Constitutional Amendment Act gave it legal status.
• It's an indirect tax for the entire country, similar to "One Nation, One Tax," with the goal of
making India a unified market.

6. • It is a single tax on the supply of goods and services across the product
life cycle, from the maker to the customer.
• It is only calculated in the "Value addition" at any point throughout the
production of goods or services.
• The ultimate customer will just pay his portion of the tax, rather than the
full supply chain as was previously the case.
• There are three types of taxes that apply under this system: CGST,
SGST, and IGST are three different taxes.

8. CGST: This is the tax levied by the federal government on intra-state
transactions (e.g., a transaction happening within Uttarakhand)
SGST: The tax levied by the state government on intra-state
transactions (e.g., a transaction happening within Uttarakhand)
IGST: It is a tax levied by the federal government on interstate
transactions (e.g., Uttarakhand to Uttar Pradesh)
UTGST: This is the tax levied by the federal government on intra-union
territory transactions for UTs without governing bodies. (e.g., a
transaction happening within Chandigarh or Daman & Diu)

9. Objectives Of GST
1. To realise the 'One Nation, One Tax' idea
Multiple indirect levies that existed under the former tax regime have been replaced with GST. The
benefit of having a single tax is that each state applies the same rate to a specific product or
service.
The central government (GST Council) sets the rates and rules, making tax administration easier.
Common laws, such as e-way bills for goods transit and e-invoicing for transaction reporting,
could be enacted.
Tax compliance is also improved because taxpayers are not burdened by various forms and
deadlines. Overall, it is a unified indirect tax compliance system.

10. 2.To subsume a majority of the indirect taxes in India
• India had several erstwhile indirect taxes such as service tax, Value Added Tax (VAT), Central Excise,
etc., which used to be levied at multiple supply chain stages. Some taxes were governed by the states
and some by the Centre.
• There was no unified and centralised tax on both goods and services. Hence, GST was introduced.
Under GST, all the major indirect taxes were subsumed into one. It has greatly reduced the
compliance burden on taxpayers and eased tax administration for the government.
3.To eliminate the taxation's cascading effect
• One of the key goals of the GST was to eliminate the tax cascade effect. Previously, due to differing
indirect tax legislation, taxpayers were unable to offset one tax's tax credits against another.
• This has aided in the elimination of the tax cascade effect and the smooth flow of input tax credits
across both products and services.

11. 4. To put a stop to tax dodging
• India's GST laws are significantly stricter than any of the country's previous indirect tax laws. Only invoices
uploaded by their individual suppliers are eligible for an input tax credit under GST.
• The chances of obtaining input tax credits on fraudulent invoices are greatly reduced in this manner. The
emergence of e-invoicing has only strengthened this goal.
• Furthermore, because GST is a national tax with a centralised surveillance system, the crackdown on defaulters is
much faster and more efficient. As a result, the GST has significantly reduced tax evasion and reduced tax fraud.
5. To broaden the base of taxpayers
• The Goods and Services Tax (GST) has aided in the broadening of India's tax base. Previously, each tax law had a
different registration threshold limit based on turnover.
• GST has boosted the number of tax-registered enterprises because it is a consolidated tax that applies to both goods
and services. Furthermore, tougher legislation governing input tax credits have aided in the taxation of certain
unorganised sectors. Take, for example, India's building business.

12. 6. Procedures for doing business on the internet
• Previously, taxpayers had to interact with a variety of tax authorities in order to comply with each tax law. Furthermore,
while filing returns was done online, the majority of the evaluation and refund procedures were done offline.
• GST procedures are now nearly fully completed online. From registration to return filing to refunds to e-way bill
production, everything is done with the press of a mouse. It has greatly aided the general ease of doing business in India
and greatly eased taxpayer compliance.
7. A better logistics and distribution system is needed.
• Multiple paperwork for the provision of products is reduced by a single indirect tax system. GST cuts transportation
cycle times, increases supply chain and turnaround times, and encourages warehouse consolidation, among other things.
• oThe abolition of interstate checkpoints under the GST e-way bill system is most favourable to the sector in terms of
enhancing transit and destination efficiency. Finally, it aids in the reduction of high logistics and warehousing expenses.

13. 9.To encourage consumption by promoting competitive pricing.
• The implementation of GST has resulted in increased consumption and indirect tax revenues.
Under the former regime, the price of goods in India was greater than in worldwide markets due to
the cascading effect of taxes.
• Even between states, lower VAT rates in some states resulted in a disparity in purchases in those
states. The uniformity of GST rates has contributed to overall competitive pricing in India and
around the world.
• As a result, consumption has increased and revenues have climbed, achieving yet another crucial
goal.
• According to the Budget 2022, The GST collections hit an all-time high of collecting Rs 1.40 lakh
crores in a month in Jan 2022.