Here we try to explain the Goods and Services Tax Bill which has received a lot of attention in business and political circles lately. . Here’s how GST differs from the current regimes, how it will work, and what will happen if Parliament clears the Bill
The GST is a Value added Tax (VAT) is proposed to be a comprehensive indirect tax levy on manufacture, sale and consumption of goods as well as services at the national level. It will replace all indirect taxes levied on goods and services by the Indian Central and state governments.
This new Tax Structure is the collection of all the previous types of Tax like Sale Tax, VAT, Entertainment Tax, Service Tax, and Income Tax etc.
Goods and Services Tax is of three types CGST, SGST, and IGST.
According to economist GST will not affect Governments profit that much but increase Indian Economy by 4.2%.
7 Tax Slabs are formed for GST Bill in India Nil, 0.25%, 3%, 5%, 12%, 18%, and 28%
Nil Tax Slab Contains – Fresh Meat, Eggs, Milk, Curd, Natural Honey, Fruits, Vegitables, Bread, Prashad, Salt, Bindi, Sindoor, Books, Paper, Newspaper, & Hotels with price less than Rs 1,000.
5% Tax Slab – Packed Food Items, Clothes below Rs 1,000 , Footwear below Rs 500, Tea, Coffee, Pizza, Kerosene, Coal, Medicines, Transport Service like Railway and Air Transport.
12% Tax Slab – Clothes above Rs 1,000 , Butter, Cheese, Dry Fruits(Packed), Ayurvedic Medicines, Fruit Juice, Agarbatti, Cell Phones and Business Class Air Tickets.
18% Tax Slab – Footwear above Rs 500, Biscuits, Cakes, Mineral Water, Camera and Other Electronics Product, andTelecom Services.
28% Tax Slab – Alcohol, Cigarettes, Pan Masala, Paint, Deo and Big Machines