What are the Salient Features of GST – Salient Features of the Goods and Service Tax (GST)- GST is an Indirect tax. GST means the Goods and Service Tax. The GST replaced many indirect taxes in India. For instance, the excise duty, VAT, services tax, etc.
What are the Salient Features of GST
The Goods and Service Tax (GST) came into force in India from 1 July 2017 through the 101st Amendment of the Constitution of India by the Indian government. It is a comprehensive tax imposed on the manufacture, sale, and use of goods and services. The most important advantage of GST is that the GST regime eliminates the tax on taxes, reduced the cost of goods. GST is mainly driven by technology.
Salient Features of the Goods and Service Tax (GST)
1) Indian GST system is a dual GST system. there is two-component of GST.i.e –
i) Central GST (CGST) -CGST means GST levied by the central government
ii) State/union territories GST (SGST/UTGST ) – SGST/UTGST means GST levied by the state government or union territories.
2) CGST and SGST apply to all transactions of goods and services. In the new amendment, a new model has been adopted for interstate transactions known as IGST.
3) GST changed the structure of indirect taxes in India. GST replaced many indirect taxes in India. For instance, the excise duty, VAT, services tax, etc.
Taxes excluded by GST:
Central Taxes
- Central Excise Duty
- Special Additional Duty of Customs
- Additional Excise Duty
- Additional Customs Duty
- Service Tax
State Taxes
- Sales Tax/Value Added Tax
- Central Sales Tax
- Entertainment Tax
- Purchase Tax
- Octroi and Entry Tax
- Taxes on Lottery, Betting
- Luxury Tax
4) GST and state GST is not allowed except for the inter-state supply of goods and services under the IGST model.
5) There is a GST council to make a recommendation on GST law to State- central. A GST council consists of the Finance Minister of India, Finance Ministers of all states, or Taxation Ministers. It is a quasi-judicial body of central and state.
6) The PAN-based TIN number shall be given to every registrant and it shall be common for the State GST and Central GST.
7) Four-Tier Tax Structure is one of the important features of GST.
GST has a Four-Tier Tax Structure –
- 5%,
- 12%,
- 18%,
- 28%.
All the goods and services can be taxed as per this the four-Tier Tax Structure.
8) Some essential goods do not have any GST. GST brought transparency in taxes and made essential goods cheaper.
9) GST laws provide for the compensation for loss of revenue to the states arising from the implementation of the Goods and Services Tax for 5 years.