The Goods and Services Tax (GST) is an indirect tax that is used in India on the supply of goods and services. GST is one indirect tax for the entire country. Under GST rules, tax is imposed at the final step of a transaction which is borne by the consumer. The GST tax percentage is a culmination of different rates of taxes which were previously imposed separately. In the case of intra-state exchanges, Central GST and State GST are imposed. Inter-state sales are chargeable to Integrated GST. Here, you will get an introduction to GST and the reason for its implementation listed below.
How has GST Impacted the Common Man?
In India, the majority of the population is middle class and lower middle class, where people either belong to service class or depend on agriculture as a source of income. In this case, the question on their minds is what would be the impact of GST on them.
There was some confusion initially when GST was introduced. The immediate impact a common man faces is the change in the price of goods and services on account of GST rates. The windfalls of GST are foreseen to hit in terms of increased input credits and decrease in a cascading impact. It is estimated that the inflationary outcome will be reduced and prices would stabilize. You need to be well aware of the latest news on GST and any updates in the market with the implementation of GST.
What are the Main Advantages of GST?
GST benefits not only the Government but also consumers in the long run. Some of the advantages are listed below.
Mitigation of Cascading Effect
Under the GST regime, one tax would be paid by the consumer for goods and services obtained. The Input Tax Credit (ITC) structure is placed to ensure that there is no slumping of any tax, the GST is assessed only on the rates of goods or services.
Abolition of Multiple Layers of Taxation
When GST was introduced, it integrated different taxes such as Central Excise, Service Tax, Sales Tax, Luxury Tax, Special Additional Duty of Customs, etc. into one centralized tax. It deters the multiple tax layers that were previously required on goods and services.
Resourceful Administration by the Government
With the introduction of GST, the integrated tax rate, simple input of taxes credit mechanism, a merged GST Network (where data is accessible) and management of resources are well-organized for the Government to access and maintain..
Ease of Doing Business
With the introduction of GST, the complications of the indirect tax abidance have been reduced. Earlier, companies endured serious problems concerning registration of VAT, excise customs, dealing with tax authorities, etc. The services of GST have benefited companies to manage their business with much more ease.
Tackling Corruption and Tax Leakages
With the help of the GST online portal, the taxpayer can now immediately register, file returns and make revenues of the taxes easily. You do not need to interact with tax authorities directly. A method has been designed to match the assertions of the supplier and buyer. This will not only maintain an inspection of tax frauds and evasion but also carry out more businesses into the legal economy.
The Latest News on GST You Ought to Know
- There were a few changes made to the GST rules which include lowering the Input Tax Credit to 10% from 20% of eligible credit, if charges or debit notes that are not reflected in filings.
- Another change on the latest news of GST is the E-way bill. Taxpayers shall be blocked, the ones who have not filed Form GSTR-1 for the past two months or two quarters.
- The exemption limit for GST hiked to Rs. 40 lakh from Rs. 20 lakh.
- The Threshold Limit for the composition scheme is now increased to Rs. 1.5 crores.
- The intra-state supplier can now pay GST at the rate of 6% (3% for Central and 3% for State) on supplies of goods or services for Rs. 50 lakh.
- If you are not filing your Goods and Services Tax (GST) returns on time, it may cost you a hefty amount of money.
- Latest news on GST regarding the tax department. On January 17, they raised the GST collection target to Rs 1.15 lakh crore over the next two months and Rs 1.25 lakh crore for the month of March by checking for any fraudulent Input Tax Credit claims.
- The Central GST Wing has sent out audit notices to taxpayers, seeking a series of nearly 12 documents. These include detailed records of business agreements of purchase and sales, GST, income tax, input service invoices, electronic cash and credit ledgers.
How Can Khatabook Help With Your GST Queries?
Khatabook is a mobile app that helps shopkeepers and Kirana store owners in India manage their books by assisting them in tracking money owed through the means of a digital ledger. Their app sends reminders on Whatsapp and through an SMS when it’s time for the merchant to collect and keep track of due payments. There are many small scale businessmen who spend a considerable amount of time tallying transactions on manual books and maintaining defaulting customers.
There are now numerous start-ups in India that provide tech-based solutions to these problems, one of them is Khatabook. Their main features are as follows.
- You can manage credit accounts easily as they have a simplified platform that facilitates reviewing transactions with all your customers.
- Even if you misplace your phone, all your transactions are automatically backed up so there is no data lost.
- There is a free SMS reminder service to remind you of due or pending payments.
GST was implemented by the Indian Government to improve the nation’s economy. You can pay your service tax online and play your role in contributing to the country’s economic development.