Who is liable to pay GST Payments to be made in GST

Q What are the Payments to be made in GST regime?

 Ans. In the GST regime, for any intra-state supply, taxes to be paid are the Central GST (CGST, going into the account of the Central Government) and the State GST (SGST, going into the account of the concerned State Government). For any inter-state supply, tax to be paid is Integrated GST (IGST) which will have components of both CGST and SGST. In addition, certain categories of registered persons will be required to pay to the government account Tax Deducted at Source (TDS) and Tax Collected at Source (TCS). In addition, wherever applicable, Interest, Penalty, Fees and any other payment will also be required to be made. 

Q  Who is liable to pay GST? 

Ans. In general the supplier of goods or service is liable to pay GST. However in specified cases like imports and other notified supplies, the liability may be cast on the recipient under the reverse charge mechanism. Further, in some cases, the liability to pay is on the third person (say in the case of e-commerce operator responsible for TCS or Government Department responsible for TDS).

Principles of subsuming the various taxes under GST

Q  What principles were adopted for subsuming the various taxes under GST? 

Ans. The various Central, State and Local levies were 4 5 examined to identify their possibility of being subsumed under GST. While identifying, the following principles were kept in mind: 

(i) Taxes or levies to be subsumed should be primarily in the nature of indirect taxes, either on the supply of goods or on the supply of services.

 (ii) Taxes or levies to be subsumed should be part of the transaction chain which commences with import/ manufacture/ production of goods or provision of services at one end and the consumption of goods and services at the other.

 (iii) The subsumation should result in free flow of tax credit in intra and inter-State levels. The taxes, levies and fees that are not specifically related to supply of goods & services should not be subsumed under GST. 

(v) Revenue fairness for both the Union and the States individually would need to be attempted.

GST would replace the following taxes

Q.Which of the existing taxes are proposed to be subsumed under GST?

 Ans. The GST would replace the following taxes:

 (i) taxes currently levied and collected by the Centre: 

a. Central Excise duty
b. Duties of Excise (Medicinal and Toilet Preparations) 
c. Additional Duties of Excise (Goods of Special Importance)
d. Additional Duties of Excise (Textiles and Textile Products) 
e. Additional Duties of Customs (commonly known as CVD) 
f. Special Additional Duty of Customs (SAD) 
g. Service Tax 
h. Central Surcharges and Cesses so far as they relate to supply of goods and services 

(ii) State taxes that would be subsumed under the GST are:

 a. State VAT 
b. Central Sales Tax 
c. Luxury Tax 
d. Entry Tax (all forms) 
e. Entertainment and Amusement Tax (except when levied by the local bodies) 
f. Taxes on advertisements 
g. Purchase Tax 
h. Taxes on lotteries, betting and gambling 
i. State Surcharges and Cesses so far as they relate to supply of goods and services The GST Council shall make recommendations to the Union and States on the taxes, cesses and surcharges levied by the Centre, the States and the local bodies which may be subsumed in the GST

What is Goods and Service Tax (GST)?

What is Goods and Service Tax (GST)? 

It is a destination based tax on consumption of goods and services. It is proposed to be levied at all stages right from manufacture up to final consumption with credit of taxes paid at previous stages available as setoff. In a nutshell, only value addition will be taxed and burden of tax is to be borne by the final consumer