During the 22nd GST Council Meeting, many decisions have been taken to make the GST System simpler and more user-friendly. Some of the key decisions taken are like differing reverse charge till the end of April 2018, change in the reporting requirements for GST Taxpayers up to a turnover of Rs 1.5 Crs and increase in threshold limit for GST taxpayers from Rs 75 Lacs to Rs 100 Lacs. To make them effective, a series of notifications have been issued by the department on 13th Oct 2017 and the synopsis is given here for ease of understanding.
In the erstwhile tax regime under VAT, we have Tax Deducted at Source, and the same is being continued under GST also. Section 51 of the Central Goods and Service Tax Act, 2017 talks about the provisions related Tax Deduction at Source. TDS is applicable to works contract also related to immovable properties in GST.
Whatever may be the time frame for the rollout and implementation of GST in India, it has huge impact on the business process and to the business houses. The business process have to be changed due to the above mentioned points. The budget session of the Parliament is being proposed from 23rd February, 2016 and it is expected to be placed in the Rajya Sabha for discussion.
In normal course of business, the registered dealer buys goods from the registered dealer and avails the input tax credit and utilizes the same for paying the output tax liability on sales. There will be certain cases where the inputs are taxed and the output is not taxed or inputs are taxed at higher rate and output is taxed at lower rate or inputs are taxed at normal rates and output is tax exempted on account of supplies to deemed export units or exports etc.
In the current tax architecture of India, Input Tax Credit i.e CENVAT Credit in case of purchase of manufactured goods and VAT credit in case of purchase of goods within in the same state is available based on the sales invoice issued by the selling dealer.
Tax is a Latin word and derived from the word Taxo means rate. Tax is a financial charge levied by the government (central / state / local body) for meeting the public expenditure like road, dams, army for safe guarding the borders etc. the dictionary meaning of tax A compulsory contribution to state revenue, levied by the government on workers’ income and business profits, or added to the cost of some goods, services, and transactions: higher taxes will dampen consumer spending.
