GST is the biggest Indirect tax reforms in India. After implementation of GST there will be One Nation and One Tax.
At Present there are various indirect taxes levied by central as well as by state government.
Taxes levied by Central Government are
- Central Excise duty
- Additional duties of excise
- Excise duty levied under Medicinal & Toiletries Preparation Act
- Additional duties of customs (CVD & SAD)
- Service Tax • Central Sales Tax
- Surcharges & Cesses
Taxes levied by State Government are
- State VAT / Sales Tax
- Purchase Tax
- Entertainment Tax (other than those levied by local bodies)
- Luxury Tax
- Entry Tax (All forms)
- Taxes on lottery, betting & gambling
- Surcharges & Cesses
When GST is being implemented there will be only one tax that is called GST. There are four components of GST to be levied at different situation. These are SGST, CGST, UTGST and IGST.
If purchase and selling of goods or rendering of services done within a state then there will be CGST and SGST applicable on goods or services.
If inter-state or from foreign territory purchase and selling of goods or rendering of services done then there will be IGST applicable on goods or services.
If purchase and selling of goods or rendering of services done within a union territory then there will be CGST and UTGST applicable on goods or services.
We will talk more about GST in the next article.