Goods & Services Tax

GST was introduced by the current Indian Government during the tax reform in 2017. 

To make the idea of a single national market possible, the Government combined different kinds of taxes & put them under the regime of GST. 

GST consists of various forms of indirect taxes like service tax, luxury tax, entry tax, entertainment tax, CST, etc. The Government also runs a portal – www.gst.gov.in to educate the people of India about the tax. 

History of GST in India

In the year 2000, Prime Minister Atal Bihari Vajpayee presented the idea of GST. He formed and set up a special committee to plan a Goods and Services Tax (GST) model for the nation. The same, Goods and Service Tax (GST), came into effect 17 years later on 1st July 2017 under the governance of current Prime Minister, Narendra Modi.

What is GST?

Here are the key terms you need to keep in mind while referring to GST – 

• GST offers a comprehensive and steady chain of tax set-offs.

• GST allows the suppliers at each end to use the input tax credit of GST paid by them while purchasing the goods and services. This Input Tax Credit (ITC) can then be used against the GST payable on the supply of goods and services.

• GST is levied on supply and is a value-added tax.

• No cascading effect can be seen on tax effects under the GST framework, meaning that under GST, no tax is charged at every stage of the process by including the tax previously paid on purchases. This helps people avoid tax on tax.