Impact of GST on Service Sector in India

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Impact of GST on Service Sector in India

• DEVELOPED BY SAG INFOTECH

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GST Impact on Service Sector

• The service sector attracts lots of foreign
  investment along with the Gross domestic product,
  into the economy of India as the sector is
  responsible for generating a heavy employment
  scenario. 
• The Indian service sector has the list of various
  industries which include trade, hotel and
  restaurants, transport, storage, communication,
  financing, insurance, real estate, business
  services, community and the construction services.

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The speculated areas are assumed to have changes
after the GST implementation

• Governments Revenue-  As much of revenue which
  was earlier left in the region of Jammu Kashmir
  will get to be collected after the implication of
  GST as in the laws previously the central
  government was not enjoying any kind of revenue
  benefits from the state but after the GST, there
  are changes and extension by which the central
  government will have the rights over the service
  taxes of Jammu Kashmir also.

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THE SPECULATED AREAS ARE ASSUMED TO HAVE CHANGES
AFTER THE GST IMPLEMENTATION 

• Costlier Services- In the present scenario of
  taxation, service tax is applicable at the rate
  of 15 on Services provided which includes 0.5
  for Swatch Bharat Cess and 0.5 for Krishi Kalyan
  Cess and now the services are expected to be
  higher at the taxation rate of around 18 to 26
  making an overall increased effects on the
  services.

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• Notices from Taxation Authorities- In the
  present scenario of taxation, both Central and
  State Govt. have right to collect the tax
  according to the preferences given in list I, II
  and III in the Constitution and because of that
  sometimes it becomes so complicated to find out
  to pay taxes to which department in regards to
  goods and services similar works contract,
  software etc. having conflicts between Central
  and State Government.

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• Registration of Place of Business- Currently
  there are centralized registration provisions
  under Service tax that indicate provider of
  services can render services from any site in
  India after getting registered once but in GST
  regime centralized registration will not be
  accessible to the dealer  requires to get
  registered with that particular state Govt where
  he has the provision for registering business
  site office as well from where he is expected to
  provide services.

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Take note of things that will Impact the services
sector on GST

• Overview of existing indirect taxes on services
  and their subsumption in GST 
• Threshold exemption
• Time of supply of services
• Place of supply of services
• Valuation under GST

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Conclusion

• The expected GST implication is known to have a
  better economic transformation but in the case of
  service, the economy will see a higher taxation
  reform for the country.
• Source GST Impact on Service Sector 

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