All You Need To Know About GST Bill

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All You Need To Know About GST Bill
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• Narendra Modi led-BJP government is keen on
  pushing the constitutional amendments in
  the Goods and Service Tax (GST) Bill in the
  monsoon session of the Parliament.

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• While the bill has been passed in the Lok Sabha,
  it is facing roadblocks from the Congress
  dominated opposition in the upper house of the
  Parliament.

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• Ahead of the beginning of the monsoon session of
  Parliament on July 18, prime Minister Narendra
  Modi reached out to the opposition seeking its
  cooperation in the smooth passage of the GST Bill.

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• The Congress however offered no assurance on the
  GST saying that it could take a stand only after
  the government gives it a written draft over
  concerns raised by it.

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Here is everything you need to know about
theGoods and Service Tax Bill
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What is GST Bill?

• The bill proposes a national value added tax to
  be implemented in India from June 2016 that would
  be a comprehensive indirect tax on manufacture,
  sale and consumption of goods and services
  throughout India, to replace taxes levied by the
  Central and State governments.

Indirect Taxes are applied on the manufacture or
sale of goods and services.
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What is proposes?

• The Bill empowers the centre to impose an
  additional tax of up to 1, on the inter-state
  supply of goods for two years or more. This tax
  will accrue to states from where the supply
  originates. While alcohol for human consumption
  has been exempted from the purview of GST, it
  will apply to five petroleum products at a later
  date.
• GST regime intends to create a harmonised system
  of taxation by subsuming all indirect taxes under
  one tax. It seeks to address challenges with the
  current indirect tax regime by broadening the
  tax base, eliminating cascading of taxes,
  increasing compliance, and reducing economic
  distortions caused by inter-state variations in
  taxes.

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Who will be in the GST Council?

• Union Finance Minister
• Union Minister of State for Revenue and state
  Finance Ministers

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Who will be in the GST Council? (Continued )

• Above ministers will recommend rates of tax,
  period of levy of additional tax, principles of
  supply, special provisions to certain states etc.

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What compensation will be provided to the states?
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What are the key issues?

• The additional 1 tax levied on goods that are
  transported across states dilutes the objective
  of creating a harmonised national market
  for goods and services.

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What are the key issues?

• Inter-state trade of a good would be more
  expensive than intra-state trade, with the burden
  being borne by retail consumers. Further,
  cascading of taxes will continue.

business is business conducted between states
Inter-state
business is business conducted within a
particular state
Intra-state
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Image source- http//economictimes.indiatimes.com
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