Latest GST Compensation cess (Rate) notification


Notification
No. & Date
Subject
English
Hindi
01/2017-Compensation Cess ,dt. 28-06-2017 Clarification on appoint the 1st day of July, 2017, as the date on which all the provisions of Goods and Services Tax (Compensation to States) Act, 2017 (15 of 2017) shall come into force
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Industry wise FAQs on GST

  • 14667

Government Services

August 30th, 2017|0 Comments

FAQ : Government Services Question 1: Are all services provided by the Government or local authority exempted from payment of tax ? Answer: No, all services provided by the Government or a local authority are [...]

  • 14688

FAQ: Gems & Jewelery

August 30th, 2017|0 Comments

FAQ : Gems & Jewellery Question 1: Whether advertising and communication material banners/hoardings/posters) provided to distributors would be treated as supply in the course of business by the company thereby not requiring any reversal of ITC? Answer: (a) [...]

  • 14659

IT/ITES Services

August 30th, 2017|0 Comments

FAQ: IT/ITES Question 1: Whether software is regarded as goods or services in GST? Answer: In terms of Schedule II of the CGST Act 2017, development, design, programming, customisation, adaptation, upgradation, enhancement, implementation of information [...]

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  • Know about gst in india

GST MSME

August 28th, 2017|0 Comments

FAQ: MSME Question 1: What is GST? Answer: GST stands for Goods and Services Tax, which is levied on supply of goods or services. “Supply” is a legal term which has very broad sweep and [...]

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  • GST faqs on Food processing

Food Processing Services

August 28th, 2017|0 Comments

FAQ : Food Processing Question 1: If I have multiple manufacturing units in a State/UT, do I have to register all my companies separately or as a group? Answer: You shall be granted a single [...]

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  • GST Sector wise implications queries - Textiels sector

Textiles Services

August 28th, 2017|0 Comments

FAQ: TEXTILES Question 1: As per Chapter 53 heading 5303 of the GST rate schedule, raw jute has been kept at the NIL rate slab. Thus, it is presumed that suppliers dealing only in raw [...]

  • 14488
  • Drugs & Pharmaceuticals Services (Medicine services) under GST

Drugs & Pharmaceuticals Services

August 28th, 2017|0 Comments

FAQ: Drugs & Pharmaceuticals :  Question 1: Whether formulations cleared have to be assessed to GST under transfer price mechanism or on the basis of MRP printed on them? Answer : The assessment of drugs and [...]

  • 12736
  • GST Handicraft services

Handicrafts Services

August 6th, 2017|0 Comments

GST Sectoral Series : Handicrafts By Directorate General of Taxpayer Services Central Board of Excise & Customs FAQ: Handicrafts Question 1: How will imports be taxed under GST? Answer: [...]

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  • GST Services wise implications : Mining Services under GST

Mining Services

August 5th, 2017|0 Comments

GST Sectoral Series : Mining By Directorate General of Taxpayer Services Central Board of Excise & Customs FAQ: Mining   Question 1: Can small mining leaseholders with a [...]

  • 12653
  • GST on E-Commerce Services under GST- Sectoral Series India

E-Commerce Services

August 4th, 2017|0 Comments

GST Sectoral Series : E-Commerce By Directorate General of Taxpayer Services Central Board of Excise & Customs FAQ: E-Commerce Question 1: What is Electronic Commerce? Answer : Electronic Commerce has [...]

  • 11459
  • Export under GST

Exports Services

July 19th, 2017|5 Comments

GST FAQ ON EXPORTS : All Question and Answers Question 1: How are exports treated under the GST Law? Answer: Under the GST Law, export of goods or services has been treated as:  inter-State [...]

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  • epc

EPC Services

November 5th, 2016|0 Comments

Impact on Output Pricing GST on services in place of Service Tax and VAT FOC impacts to be factored in supply No more abatements forseen, rate at general level. Exemption forseen for [...]

  • 5188
  • manufacturing-services

Manufacturing Services

November 5th, 2016|2 Comments

Impact on Output Pricing FOC impacts to be factored in supply Exemption forseen for schools, UN, SEZ only Impact on Supply Chain Management Branch transfers taxable [...]

  • 5186
  • housekeeping-services

Housekeeping Services

November 5th, 2016|2 Comments

Impact on Output Pricing FOC impacts to be factored in supply Exemption forseen for schools, UN, SEZ only Impact on Supply Chain Management Usually no supply [...]

  • 5184
  • MAINTENANCE SERVICES

Maintenance Services

November 5th, 2016|2 Comments

Impact on Registrations Separate registrations in each state. ISD registration in case of common input services. TDS deduction by customer may impact decision of registration. Impact on Cash [...]

  • 5182
  • repairing-sector

Repairing Services

November 5th, 2016|0 Comments

Impact on Output Pricing GST on services in place of Service Tax and VAT FOC impacts to be factored in supply No more abatements forseen, rate at general level. Exemption forseen for [...]

  • 5180
  • Catering Services

Catering Services

November 5th, 2016|2 Comments

Impact on Output Pricing FOC impacts to be factored in supply Inputs mostly (fruits/ vegetables/ basic food) may be exempt while output taxable. No more abatements Exemption forseen for factory canteens, schools, [...]

  • 5178
  • TRAVEL SERVICES

Travel Agency Services

November 5th, 2016|3 Comments

Impact on Output Pricing Inter state and Intra state supplies Supply Valuation – a major challenge especially in case of associated enterprises / Branches FOC impacts to be factored in supply No [...]

  • 3701

Trading

September 25th, 2016|1 Comment

    Read More  EPC SERVICES MANUFACTURING SERVICES HOUSEKEEPING SERVICES MAINTENANCE SERVICES REPAIRING SERVICES CATERING SERVICES TRAVEL AGENCY SERVICES TOUR OPERATOR SERVICES ECOMMERCE OPERATOR SERVICES HOTEL [...]

  • 3698

Tour Operator Services

September 25th, 2016|0 Comments

Impact on Output Pricing Separate registrations in each state ISD registration in case of common input services TDS deduction by customer may impact decision of registration Impact on [...]

Benefits of GST (GST Benefits for All) in India

GST Benefits

Directorate General of Taxpayer Services
CENTRAL BOARD OF EXCISE & CUSTOMS

 

GST: The Single Biggest Tax Reform Undertaken Since Independence to Ease Compliance

GST stands for Goods and Services Tax, which will be levied on the supply of goods or services or both in India. GST will subsume a number of existing indirect taxes being levied by the Centre and State Governments,
including Central Excise duty, Service Tax, VAT, Purchase Tax, Central Sales Tax, Entry Tax, Local Body Taxes, Octroi, Luxury Tax, etc.

It brings benefits to all the stakeholders viz. industry, government and the citizens. It is expected to lower the cost of goods and services, boost the economy and make our products and services globally competitive.
GST aims to make India a common national market with uniform tax rates and procedures and removes the economic barriers, thereby paving the way for an integrated economy at the national level. By subsuming most of the Central and State indirect taxes into a single tax and by allowing a set-off of prior-stage taxes for the transactions across the entire value chain, GST would mitigate the ill effects of cascading and thereby improve our competitiveness.

GST is a destination based consumption tax. It has been designed in a manner so that the tax is collected at every stage and the credit of tax paid at the previous stage is available to set off the tax to be paid at the next stage of transaction, thereby eliminating cascading of taxes. This eradicates “tax on tax” and allows cross utilization of input tax credits, which benefit the industry by making the entire supply chain tax neutral.

Benefits of GST In India.

GST (GOODS AND SERVICES TAX) BENEFITS

GST will give a major boost to the ‘Make in India’ initiative of the Government by making goods or services produced or provided in India competitive in the national and international markets. Further, all imported goods will be charged with integrated tax (IGST), which will be more or less equivalent to Central GST + State GST. This brings parity in taxation on local and imported products.

Under the GST regime, exports will be zero rated in entirety unlike the present system where refund of some taxes is not allowed due to fragmented nature of indirect taxes between the Centre and the States.
All taxes paid on the goods or services exported or on the inputs or input services used in the supply of such export goods or services shall be refunded. The principle of exporting only the cost of goods or services
and not taxes would be followed. This will boost Indian exports, thereby improving the balance of payments position. Exporters will be facilitated by grant of provisional refund of 90% of their claims within seven days of issue of acknowledgement of their application, thereby resulting in the easing of position with respect to cash flows.

benefit of one tax gst

GST is expected to bring buoyancy to the Government Revenue by widening the tax base and improving the taxpayer compliance. GST is likely to improve India’s ranking in the Ease of Doing Business Index and is estimated to increase the GDP by 1.5% to 2%. GST will prevent cascading of taxes by providing a comprehensive input tax credit mechanism across the entire supply chain. The seamless availability of Input Tax Credit across goods or services at every stage of supply will enable streamlining of business operations. Uniform GST rates will reduce the incentive for evasion by eliminating rate arbitrage between neighbouring States and that between intra and inter-State sales.

Harmonization of laws, procedures and rates of tax will make compliance easier and simple. There would be common definitions, common forms/formats, common interface through GST portal, resulting in efficiencies and synergies across the board. This will also remove multiple taxation of same transactions and inter-State disputes like the ones on entry tax and e-commerce taxation existing today. All this will also help in reduction of compliance costs, alleviate the need for multiple record keeping for a variety of taxes, leading to lesser investment of resources and manpower in maintaining records.

Common procedures for registration of taxpayers, refund of taxes, uniform formats of tax return, common tax base, common system of classification of goods or services along with timelines for every activity will lend greater certainty to taxation system. GST is largely technology driven. The interface of the taxpayer with the tax authorities will be through the common portal (GSTN). There will be simplified and automated procedures for various processes such as registration, returns, refunds, tax payments, etc. All processes, be it of applying for registration, filing of returns, payment of taxes, filing of refund claims etc., would be done online through GSTN. The input tax credit will be verified online. Electronic matching of input tax credit across India will make the process more transparent and accountable. This will encourage a culture of compliance. This will also greatly reduce the human interface between the taxpayer and the tax administration, leading to speedy decisions.

Average tax burden on trade and industry is likely to come down, which is expected to reduce prices, resulting in more consumption, which in turn means more production and thereby boosting the growth of the industries. The removal of cascading of taxes and increased transparency will make the citizens more informed about the taxes they pay while purchasing goods or services. GST will boost domestic demand, create more opportunities for domestic business and drive job creation. GST might not be the panacea for all the ills of indirect tax system but is also not far from that.

GST advantages and disadvantages for india

All States Eway Bill Notifications/Forms/Limit : Click Here

Continue Reading : About GST India

Check your ARN Number Status (GST Registration)


Know Your ARN Number Status  : Click Here


what is full form of ARN Number?

Application Reference Number ( ARN NUMBER) 

You will receive an ARN Number after Filling your Registration Form on GST Network website gst.gov.in

This ARN Number will be received on your registered Email ID

Format of GST ARN Number :

  • First two digits of your ARN Number is AA albhabets
  • Next two digits of your ARN Number is your State Code
  • Next two digits of your ARN Number is Month.
  • Next two digits of your ARN Number belongs to the Year.
  • Next six digits of your ARN Number is System generated Code
  • Last digits of your ARN Number is for check code.

Other gst.gov.in (GST portal) searches : 


Search via GSTIN  (Search Tax Payer via GST Number) : Click Here


Track Your GSTIN Provision ID (Provision Identification Number) : Click Here


Check GST Payment Status : Click Here


Check GST Registration Status via PAN Number : Click Here


Check GST Registration Status via Registration Number : Click Here


Search taxpayer opted In/ Out for Composition : Clik Here


Search Office Addresses : Click Here

items of gst with rates

what is full form of GSTIN

What is meaning of GSTIN? What is the Full form of GSTIN?

GSTIN is a unique 15 Digits code that has been issued/alloted to taxpayers covered under GST.

Full Form of GSTIN : GOODS AND SERVICES TAX IDENTIFICATION NUMBER

15 Digits GSTIN Number Format detailed : 

  • The First two digits of GSTIN is your State Code.
  • The Next ten digits of GSTIN is PAN Number of the Business entity/proprietor.
  • Thirteenth digit of your GSTIN is based on the number of registrations done by the business entity within a state.
  • Fourteen digit of your GSTIN Number is Z by default.
  • The Last digit of your GSTIN check code.

Check GST registration status/Track GSTIN : Click Here

Check Your ARN Number Status  : Click Here

Check GST Payment Status : Click Here

Continue Reading : Beginners Guide to GST India

items of gst with rates

Know Your State Code under GST

zone commissioneratedivision range jurisdiction
AhmedabadKutch (Gandhidham)BhujRange IBhuj City (Municipal Area)
AhmedabadKutch (Gandhidham)BhujRange IIMadhapar, Kukma, Lakhond, , Kanaiyabe, Paddhar and Chubadak.
AhmedabadKutch (Gandhidham)BhujRange IIIRudrani to Khavda, Dhorda, Hajipir, Loriya, Sumrasar, Mirzapar, Sukhpar, Mankuva, Deshalpar, Bharapar, Kera, Gajod.
AhmedabadKutch (Gandhidham)BhujRange IVNakhtrana Taluka
AhmedabadKutch (Gandhidham)BhujRange VAbdasa & Lakhpat Taluka.

The first 2 digits of the GSTIN is the State code, next 10 digits are the PAN of the legal entity, the next two digits are for entity code, and the last digit is check sum number. Know about GST India : Click Here

No Levy of GST (All Items List) HSN Code & GST Tariff of free items

Complete list of Items of Goods on which no Levy of GST (Nil GST Rate). Schedule of Goods items on which applicability of GST is NIL. HSN Code (Harmonized System of Nomenclature) list of items on which GST rate is NIL. GST Tariff of India of Tax Free Items : 

 

statecommissioneratedivision range jurisdiction
chhatisgarhRaipurBhilai -IRANGE - ISAIL Plant area, area of Civic Centre Sector 01 to 10 and Ruabandha.
chhatisgarhRaipurBhilai -IRANGE - IIArea of Borai, Rasmada, Nehru Nagar, Smiriti Nagar.
chhatisgarhRaipurBhilai -IRANGE - IIIArea of Supela, Power House, Shanti Nagar, Kohka and Baishali Nagar.
chhatisgarhRaipurBhilai -IRANGE - IVArea of both side of Nandini Road, LIA, HIA, Hathkhoj, Transport Nagar.
chhatisgarhRaipurBhilai -IRANGE - VArea of Bhilai-3, Charoda, Patan, Kumhari and Ahirwara.
chhatisgarhRaipurBhilai - IIRANGE-IArea of Ward No 01 to 30 of Durg Nagar Nigam, Balod Dalli-Rajhara, Dalli, Dondi-Lahra.
chhatisgarhRaipurBhilai - IIRANGE-IIArea of Ward No. 31 to 64 of Durg Nagar Nigam, HUDCO.
chhatisgarhRaipurBhilai - IIRANGE-IIIArea of Rajnadgaon District (North of GE Road)
chhatisgarhRaipurBhilai - IIRANGE-IVArea of Rajnadgaon District (South of GE Road).
chhatisgarhRaipurBhilai - IIRANGE- VArea of Bemetara, Kawardha District.

Goods and Service Tax Law – Implications on Works contract and Job work

Implications on Works contract and Job work

 

122nd Constitutional Amendment Bill, 2014

122nd Constitutional Amendment Bill, 2014

Bill No 192-C OF 2014

THE CONSTITUTION (ONE HUNDRED AND TWENTY SECOND AMENDMENT) BILL, 2014

A

BILL

Further to amend the Constitution of India

Be it enacted by parliament in the sixty-sixth year of the Republic of India as follows:-

  1. (1) This act may be called the constitution (one hundredth amendment) Act, 2015.
    (2) It shall come into force on such date as the Central Government may by notification in the Official Gazette, appoint , and different dates may be appoint for different provisions of this act and any reference in any such provision to the commencement of this Act shall be constructed as a reference to the commencement of that provision.
  2. After article 246 of the constitution, the following article shall be inserted , namely:-
    “246A.
    1. Notwithstanding anything contained in article 246 and 254, Parliament and subject to clause (2), the legislature of every state, have power to make laws with respect to goods and service tax imposed by the union or by such state.
    2. Parliament has exclusive power to make laws with respect goods and service tax where the supply of goods, or of services, or both takes place in the course of interstate or commerce.
    Explanation – The provision of this article, shall in respect of goods and services tax referred to clause (5) of article 279A, take effect from the date recommended by the Goods and Service Tax Council.”
    3. In article 248 of the Constitution, in clause (1) , for the word “Parliament “ the figures and letter “ Subject to article 246A ,Parliament “ shall be substituted .
    4. In the article 249 of the Constitution, in clause (1) after the word “with respect to “, the word and figure “goods and services tax provided under article 246A or “shall be inserted.
    5. In the article 250 of the Constitution, in clause (1) after the word “with respect to “, the word and figure “goods and services tax provided under article 246A or “shall be inserted.
    6. In article 268 of the constitution, in clause (1), the word “and such duties of exercise on medicinal and toilet preparation “shall be omitted.
    7. Article 268A of the constitution, as inserted by section 2 of the constitution (Eighty –eight Amendment) Act, 2003 shall be omitted.
    8. In article 269 of the constitution, in clause (1), after the word “consignment of goods”. The words, figure and letter ‘expected as provided in article 269 A” shall be inserted.
    9. After article 269 of the constitution , the following article shall be inserted namely –
    “269A (1) Goods and services tax on supplies in the course of interstate trade or commerce shall be levied and collected by the Government Of India and such tax shall be apportioned between the Union and the States in the manner as may be provided by Parliament by law on the recommendations of the Goods and Services Tax Council.
    Explanation —- For the purpose of this clause,, supply of goods and services or both in the course of import into the territory of India shall be deemed to be supply of goods , or of service, or both in the course of Inter –state trade or commerce.
    (2) Parliament may, by law, formulate the principle for determining the place of supply, and when a supply of goods or of services, or both takes place in the place in the course of interstate trade or commerce.”
    10. In article 270 of the Constitution :-
    i. in clause (1) for the words , figure and letter “article 268,268A, and 269 “’,the word , figure and letter “article 268,268A, and 269 A” shall be inserted ;
    ii. after clause (1) , the following clause shall be inserted , namely—
    “(IA) the goods and service tax levied and called by the Government of India, except the tax apportioned with the States under clause (i) of the article 269A,shall also be distributed between the Union and the States in the manner provided in clause (2).”
    11. In article 271 of the constitution, after the word “in those articles “, the words and figure and letter “except the goods and services tax under article 246A,”shall be inserted.
    12. After article 279 of the constitution, the following article shall be inserted , namely:—-
    “279A.
    (1) the President shall, within sixty days from the date of commencement of the constitution (One Hundredth Amendment )Act,2015, by order , constitute a council to be called the goods and services Tax Council .
    (2) the goods and services tax Council shall consist of the following members , namely—-
    (a) the Union Finance Minister _______________ chairperson
    (b) the union minister of state in charge of revenue or finance ________________member
    (c) The minister in charge of finance or taxation or any other minister nominated by each state Government ______________________________ members.
    (3) The Members of the goods and service tax council referred to sub clause © of clause (2) shall, as soon as may be , choose one amongst themselves to be the Vice –chairperson of the council for such period as they may decide.
    (4) the goods and service tax council shall make recommendations to the union and the state on ———–
    (a) the taxes, cesses and surcharges levied by the Union, the States and the local bodies which may be subsumed in the goods and services tax
    (b) the goods and services that may be subjected to, or exempted from the goods and services tax;
    (c) model Goods and Services Tax Laws, principles of levy, apportionment of Integrated Goods and Services Tax and the principles that govern the place of supply;
    (d) the threshold limit of turnover below which goods and services may be exempted from goods and services tax;
    (e) the rates including floor rates with bands of goods and services tax;
    (f) any special rate or rates for a specified period, to raise additional resources during any natural calamity or disaster;
    (g) special provision with respect to the States of Arunachal Pradesh, Assam, Jammu and Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh and Uttarakhand; and .
    (h) any other matter relating to the goods and services tax, as the Council may decide.
    (5) The Goods and Services Tax Council shall recommend the date on which the goods and services tax be levied on petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas and aviation turbine fuel.
    (6) While discharging the functions conferred by this article, the Goods and Services Tax Council shall be guided by the need for a harmonised structure of goods and services tax and for the development of a harmonised national market. for goods and services .
    (7) One half of the total number of Members of the Goods and Services Tax Council shall constitute the quorum at its meetings.
    (8) The Goods and Services Tax Council shall determine the procedure in the performance of its functions.
    (9) Every decision of the Goods and Services Tax Council shall be taken at a meeting, by a majority of not less than three-fourths of the weighted votes of the members present and voting, In accordance with the following principles, namely:—-
    (a) the vote of the Central Government shall have a weightage of one- third of the total votes cast, and
    (b) the votes of all the State Governments taken together shall have a weightage of two-thirds of the total votes cast, in that meeting.
    (10) No act or proceedings of the Goods and Services Tax Council shall be invalid merely by reason of-
    (a) any vacancy In, or any defect In, the constitution of the Council; or
    (b) any defect in the appointment of a person as a Member of the Council; or (c) any procedural Irregularity of the Council not affecting the merits of the case.
    (11) The Goods and Services Tax Council may decide about the modalities to 15 resolve disputes arising out of its recommendations.”
    13. In article 286 of the Constitution ,———–
    i. in clause (1)——–
    A. for the words “the sale or purchase of goods where such sale or purchase takes place”, the words “the supply of goods or of services or both, 20 where such supply takes place” shall be substituted;
    B. in sub-clause (b), for the word “goods”, at both the places where it occurs the words “goods or services or both” shall be substituted;
    ii. in clause (2), for the words “sale or purchase of goods takes place”, the words “supply of goods or of services or both” shall be substitute
    iii. clause (3) shall be omitted.
    14. ln article 366 of the Constitution,-
    i. after clause (12) ,the following clause shall be inserted , namely:—-
    ‘(12A)” goods and service tax “means any tax on supply of goods, or services or both except taxes on the supply of the alcoholic liquor for human consumption;
    ii. in clause (26) , the following clauses shall be inserted , namely:-
    ‘(26A) “Services “means anything other than goods;
    (26B) “State with reference to article 246A, 268, 269, 269A and 279A include a Union territory with Legislature:
    15. In article 368 of the Constitution, in clause (2), in the proviso, in clause (a)for the words and figures “article 162 or article 241 “, the words, figures and letter “article I 62, article 241 or article 279A “ shall be substituted.
    16. In the Sixth Schedule to the Constitution, in paragraph 8, in sub-paragraph (3),—–
    (i) in clause (c), the word “and “ occurring at the end shall be omitted;
    (ii) in clause (d), the word “and “ shall be inserted at the end ;
    (iii) after clause (d), the following “and “ shall be inserted ,namely:-
    “(e) taxes on entertainment and amusements .”.
    17. In the Seventh Schedule to the Constitution —–
    (a) in List I— Union List—
    i. For entry 84,the following entry shall be substituted , namely:—
    “84. Duties of excise on the following goods manufactured or produced in India, Namely –
    (a) petroleum crude
    (b) high speed diesel ;
    (c) motor spirit (commonly known as petrol);
    (d) natural gas ;
    (e) aviation turbine fuel :and
    (f) tobacco and tobacco products “;
    ii. entries 92 and 92C shall be omitted ;
    (b) in list II-State List—
    i. entry 52 shall be omitted;
    ii. for entry 54, the following entry shall be substituted, namely:-
    “54. Taxes on the sale of petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas, aviation turbine fuel and alcoholic liquor for human consumption, but not including sale in the course of inter-State trade or commerce or sale in the course of international trade or commerce of such goods.
    iii. entry 55 shall be omitted;
    iv. for entry 62, the following entry shall be substituted, namely:-
    “62. Taxes on entertainments and amusements to the extent levied and collected by a Panchayat or a Municipality or a Regional Councilor a District Council.” 18. (1) An additional tax on supply of goods, not exceeding one per cent, in the course of inter-State trade or commerce shall, notwithstanding anything contained in clause (1) of article 269A, be levied and collected by the Government of India for a period of two years or such other period as the Goods and Services Tax Council may recommend, and such tax shall be assigned to the States in the manner provided in sub-section (2).
    (2) The net proceeds of additional tax on supply of goods in any financial year, except ‘the proceeds attributable to the Union territories, shall not form part of the Consolidated
    Fund of India and be deemed to have been assigned to the States from where the supply originates . (3) The Government of India may, by where it consider necessary in the public interest, exempt such goods from the levy of tax under sub –section (I).
    (4) Parliament may , by law, formula the principles for determining the place of origin from where supply of goods take place in the course of inter- state trade or commerce.
    (5) For purpose of this section,” state “shall have the meaning assigned to it in clause (26B) of article 366 of the Constitution. 19. Parliament may, by law, on the recommendation of the Goods and Services Tax Council, provide for compensation to the States for loss of revenue arising on account of implementation of the goods and services tax for such period which may extend to five years.
    20. Notwithstanding anything in this Act, any provision of any law relating to tax on goods or services or on both in force in any State immediately before the commencement of this Act, which is inconsistent with the provisions of the Constitution as amended by this Act shall continue to be in force until amended or repealed by a competent Legislature or other competent authority or until expiration of one year from such commencement, whichever is earlier
    21. (1) If any difficulty arises in giving effect to the provisions of the Constitution as amended by this Act (including any difficulty in relation to the transition from the provisions of the Constitution as they stood immediately before the date of assent of the President to this Act to the provisions. of the Constitution as amended by this Act), the President may, by order, make such provisions, including any adaptation or modification of any provision of the Constitution as amended by this Act or law, as appear to the President to be necessary or expedient for the purpose of removing the difficulty:
    Provided that no such order shall be made after the expiry of three years from the date of such assent.
    (2) Every order made under sub-section (1) shall, as soon as may be after it is made, 20 be laid before each House of Parliament.

 

GST Implementation – Government’s Perspective

After the enactment of Constitutional (101st Amendment ) Act, 2016, the hope for advent of Goods and Service Tax (“GST”) in India is no distant dream.  GST Council has also been notified on September 15, 2016 and thus, the policy formulators have taken their positions as part of this Think-tank and shall be responsible for taking the biggest fiscal decisions of the Country.   The initial decisions would include formulation of Model GST law, rates as shall be applicable to different goods / services, determination of exemption to goods and / or services, Rules and processes etc.

Having said the same, this main body requires a lot of homework by each of its constituents.  Since the body has become a single place for determining almost everything in relation to taxing supply of goods and services in the Country, each of its constituent would now have to understand the impact of every decision of the GST Council on its own subjects, impact on its treasury from such decisions, its relationships with its fellow states and also the movement of business into and out of its states.  All these decision would change the way Governments have till now visualized their indirect policy and the way they shall be doing the same in the new era.  Also, the focus of demands of the industry might also shift from state specific requests to request to GST Council.   At this stage it is pertinent to mention that while the focus of each state should be meet its local interest, however, for the success of GST in India, the aim should be national interest.

Thus, to achieve the above objective, every stakeholder, including government of all states, Central Government and Union territories with legislature would be required to formulate certain bodies and undertake certain works, some of which are proposed in this article:

Restructuring their administration cadre:  GST enactment would not be a big change only for tax payer but also the tax administration.  The way taxes were imposed and collected would see a drastic shift and thus, the restructuring of tax administration at all levels is inevitable.  The jurisdictions and subjects shall change, thus requiring the entire administration cadre to be restructured.  The change becomes more difficult when we speak about a country like India having varied demographic and cultural profiles.

Forming their own internal think tanks:  Though every government would be part of the larger think tank – the GST Council, to support their representation in the GST Council they would require a team of experts and administrators who can present their requirement to the representative and also are capable of assessing the impact of policy decisions proposed or taken in such GST Council.  The experts would come from different walks of trade including representatives of trade bodies/ associations, Accounting professionals, representatives of consumer bodies, economists, Information technology experts etc.

Reworking their tax administration system:  Increasing tax base is always the focus of every government as it denotes both prosperity amongst citizens and more revenue for government.  The manner of increasing tax base would altogether change in the new regime and the government would be required to learn new manner of administering their subjects – through electronic systems.  The new regime would be dependent on robust IT systems and also a team of techno-administrators who could analyse the huge data as shall be supplied by the taxpayers through electronic interface of GST Network (GSTN).  The IT infrastructure, interface with tax payers and analysis interface with departmental officers shall determine the fate of ease with which collections would be maximized in a proper manner by the respective governments.

Training for the new era:  Even though the entire infrastructure and interface be placed, desired results cannot be achieved unless the entire team of officers who shall administer the tax payer in the coming times are trained in a proper and systematic manner so that when the data of the tax payers is put before them, the same can be

Approachable approach: Apart from a lenient view, the addressal of the problems of the taxpayer be handled through a matured system of online and call centres wherein a taxpayer without being asked to disclose his identification can share his problem and can get an answer and sooner we may find a compliant tax base with lesser tax shortfalls.  The model need to be replicated in physical mode in form of help-desks at the government offices to address problems of small tax payers as well who are not much acquainted with technology.

Government should also ensure that GST provisions are made available in form of small booklets and mobile app in regional languages. Even important decisions impacting common tax payers should also be communicated in regional language to ensure effective communication with all stakeholders.

A soft approach:  The initial phase of the implementation shall have teething problem for both tax payer and administration.  While the focus on part of government shall be to properly capture its tax base as well as their transactions, the trouble is no less for taxpayer as he also shall be facing a lot issues in terms of understanding the new law, upgrading his IT infrastructure to meet the requisites of compliance, training his team etc.  These changes may result in errors and omissions on part of the subjects.  Though intentional evasions can never be ruled out but it is also to be believed that most of the taxpayers are not evaders and thus, an initial moratorium be allowed to all at-least for six months where when pointed out, and when tax and interest is paid by the tax payer, penalty proceedings should not be initiated against them.

Check on rise in commodity pricing: A basic fear which has grasped the minds of the citizens before the advent of GST is the rise in prices of basic commodities.  Thus, it becomes imperative on part of both Central and State governments to ensure check on commodity prices, particularly food items and medicines and if need be to take counter measures like maintaining stock and ensuring their availability through mass distribution mechanism.

To conclude:

Though each stakeholder might have hundreds of idea to make this proposed legislature better, however, the need of the hour is to provide ideas to make it a success.  Though each of the stakeholders is important, however, being the biggest stakeholder, government need to play the most important part to support all its subjects during this most challenging transformation of Indian Indirect taxation.