Government issues Notification for roll out of GST
The government has notified the roll out of Goods and Services Tax (GST) from July 1st.
To launch GST in the midnight of June 30th, the government has organised a special programme to be held in Central Hall of Parliament. The event will see the participation of President Pranab Mukherjee, Prime Minister Narendra Modi, Finance Minister Arun Jaitley and other Ministers and bureaucrats.
As per the last year’s Constitutional amendment approved by Parliament, the government has been given time only till 15th of September, 2017. Within that time period, the government has to replace the existing indirect tax structure by the GST, failing which may trigger a constitutional crisis as no tax can be levied on goods and services. So, the government has ruled out the possibility of deferring the roll out of GST by any further time period.
GST which will subsume a host of indirect levies like excise, service tax and VAT will be one of the nation’s biggest economic reform.
Goods and Services Tax is a comprehensive indirect tax which is to be levied on the manufacture, sale and consumption of goods and services in India. This is so far the biggest tax reform in the country. GST eliminates the cascading effect of taxes because it is taxed at every point of business and the input credit is available in the value chain.
France was the first country to introduce GST system in 1954. More than 140 countries have implemented the GST. The Genesis of GST occurred during the previous NDA Government under Atal Bihari Vajpayee Government when it set up the Asim Dasgupta committee to design a model for GST. The UPA Government took the matter further and announced in 2006 that this tax would be introduced from April 1, 2010. However, so far it was not introduced. All the GST bills including Constitution (101st Amendment) Act have been passed now and GST is set to come into force from July 1, 2017.
GST would replace almost all vital indirect taxes and cesses on Goods & services in the country. Among the taxes levied by centre, GST will subsume the following: Central Excise Duty & Service Tax, Duties of Excise (Medicinal and Toilet Preparations), Additional Duties of Excise (Goods of Special Importance), Additional Duties of Excise (Textiles and Textile Products), Additional Duties of Customs (commonly known as CVD), Special Additional Duty of Customs (SAD), and finally the Central Surcharges and Cesses.
Among the state taxes that would be replaced by GST include State VAT, Central Sales Tax c. Luxury Tax, Entry Tax (all forms), Entertainment and Amusement Tax (except when levied by the local bodies), Taxes on advertisements, Purchase Tax, Taxes on lotteries, betting and gambling, and finally the state Surcharges and Cesses.
Categories: Business & Economy Current Affairs 2017