SOME IMPORTANT IMPACT OF GST IMPLEMENTATION
- GST will subsume all taxes including VAT, Works Contract Tax, CST, Excise Duty, Countervailing Duty(levied on imports) and Service Tax.
- All existing registered Dealers, Service Providers and Manufacturers will have to register online on GSTN.
- Single organization having multiple warehouses/offices/units will need to register in all respective states from where storage/sale of goods will effect.
- GST input credit will be in three categories, State GST(SGST), Central (CGST) and Interstate GST(IGST).
- All intra-state sales/purchases will entail equally SGST and CGST.
- Suppose the rate of GST is 12% then while selling, dealer will charge 6% SGST and 6& CGST and accordingly deposit the Tax in two different treasury, State and Central respectively.
- Similarly the purchasing Dealer will take input credit in two different accounts i.e. SGST and CGST.
- All further sales will involve payment of tax on the vale addition after taking due input credit.
- All inter-state sales/purchases will entail IGST
- Here the selling dealer will charge full rate of IGST @ 12%(as per example) and deposit the same in IGST account of the treasury.
- Similarly the purchasing Dealer will take input credit in the account of IGST.
- All IGST input credits will be first set off against inter-state sales and then intra-state sales.
- All sales to export processing zones and from TAX-exempted zones will have to charge IGST.
- Stock transfer from one location to another location will not be TAX free.
- During transition period from VAT to GST, all dealers carrying inventories from VAT regime will have to declare corresponding Tax Invoices to claim additional input credit in lieu of Excise Duty/Service Tax/CVD.
- All items in all states will be taxed on one rate.
- Entire GSTN process is online, including filing of return etc.
- Audit, assessment etc. will be conducted only on 1% of the assesses on defined parameters.
