1. one nation, one tax'
PRESENTATION COVERED…
1. What is GST and its key features
2. GST- How it works ?
3. Need for GST
4. Indian taxation
5. Indian Economy- An overview
6. GST - Issues yet to be decided…..
BY
RATNESH PATHAK

2.  GST st ands f or "Goods and Ser vices Tax",
and is pr oposed t o be a compr ehensive
indir ect tax levy on manuf act ur e, sale and
consumpt ion of goods as well as ser vices at
t he nat ional level. I t will r eplace all
indir ect taxes levied on goods and ser vices
by t he I ndian Cent r al and St at e
gover nment s.
 The main expect at ion f r om t his syst em is t o
abolish all indir ect t axes and only GST
would be levied. As t he name suggest s, t he
GST will be levied bot h on Goods and
Services.
 GST is a t ax t hat we need t o pay on supply

3.  Dealers will charge GST on the price of goods
and services.
 Claim credits (CENVAT) on purchases of
goods and services.
 collect the tax from their customer, and deduct
the tax already paid.

4.  As a developing country, India needs a transparent & unambiguous
tax structure
 A complex tax structure with multiple rates of taxes
 Multiple taxes across the supply chain
 High transaction cost in the hands of the tax payers
 Increased tax collections due to wider tax base and better
compliance
 Improvement in international cost competitiveness of indigenous
goods and services.
 Enhancement in efficiency in manufacture and distribution due to
economies of scale
 GST encourages an unbiased tax structure that is neutral to
business processes, business models, organization structure,
product substitutes and geographical locations
 Helping as a weapon against corruption
 GST operates on a negative list i.e. all goods and services are subject
to GST unless specifically exempted

5. TAXATION POWERS OF UNION
Income Tax – on income, except
agricultural income
Excise Duty – on goods manufactured
Custom Duty – on imports
Service Tax – on specified services
Central Sales Tax – on inter-state sale of goods
Stamp Duty – on 10 specified instruments
To be contd…..

6.  Confusion and Mistrust
 Complex and lacking in stability
 Hidden tax on exports, no state tax on imports
 High transaction costs
 Narrow base
 High compliance cost
 To much litigations
 Lack of harmony and inter state practices
 Highly corruption

7.  India’s economy is the 11th
largest economy in the
world and the third largest by purchasing power
parity (PPP)
 G-20 major economies and a member of BRICS
 World is presently facing recession-II but Indian
economy is still better than comparable
economies.
 Agriculture, services and industry are the major
sector of India an economy. Contribution of
different sectors in March, 2012 was :
 Agriculture 19%
 Services 59%
 Industry 22%
to be
contd…….

8. GDP COMPOSITION IN MARCH, 2012
Agriculture
19%
Industry
22%
Service
Sector
59%

9.  Constitutional amendment authorizing
state to collect and retain tax on services.
 Integration of certain Central & State taxes
(Various Cess, Electricity duty,
Entertainment tax etc)
 Stock transfers
 Road permits and check posts

10.  Taxation of inter-state services and their method of taxation
 Difficulties in defining Place of supply, place of delivery
 Group Health Insurance
 Consulting services
 However most of the B2B services not a problem
because of availability of credit
 Disputes even with regard to classification of goods
 Jurisdictional Issues with regard to registration and SCN /
Assessments