Blog Details

Author - Associate Nupur Mehrotra

GST ( GOODS AND SERVICE TAX) can be defined as a type of indirect tax that is levied on goods and services provided and this has replaced many indirect taxes which was charges in India. This concept was introduced in the parliament on 29^th March 2017 and came to effect from 1^st July 2017. So GST is a single indirect tax concept for the entire nation.

Recent amendments have been introduced in GST and those are listed below-

• It has been stated by the finance minister of Jammu and Kashmir that J&K will also be applying GST. CGST and IGST will be dealt with separately as J&K follows a separate constitution.
• Unlike earlier now the gift given to an employee will not be considered as a supply of good from one person to another person. A gift does not hold any consideration and therefore it will not attract any GST if the gift amount is below 50000. Only any amount above this will be considered for GST.
• Also, it has been stated by the government that sale of building or land will not be taken as supply of goods and therefore no GST will neither be charged upon this nor on any rented land. It will be only charged on constructing a building and on the selling of any land or building that is under construction.
• CGST and IGST which was earlier fixed with the upper limit as 14% and 25% respectively have now been brought up to 20% and 40% respectively to ensure flexibility in rates for the future increase but no changes have been made in the GST slabs.
• Also, the industries dealing with petroleum products have GST to be implemented on them now. Credit can now be taken by the India businessman for the purchase of petrol products. So with the increase and availability of input credit, the good prices will come down.
• The taxpayers who had less than 50 lakhs as their turnover or the previous financial year are now exempted from taking the permission of the officer and can directly get themselves registered under the composition scheme and can directly pay under it.
• The earlier GST model did not define as to how the unregistered dealer will be paying the tax after selling the good to the registered buyer but now it has been clarified that a non-registered supplier cannot charge GST on sales. So, if a buyer who is registered buys good and services from a dealer who is not registered will have to pay the GST.
• There has been a change in the provision of time of supply of services. If the invoice is issued within the prescribed time that is issue date of the invoice or receipt of payment date as to whichever is earlier, if the invoice is not issued within time then the date of receipt of payment or date on which the service has to be provided would be considered as the time of supply of goods for considering the liability to pay tax.
• Also, there are changes in the condition for not allowing ITC. Earlier if the buyer fails to pay the service provider within 3 months the buyer would be disallowed input tax credit (ITC) earlier availed by the buyer and the buyer had to pay back the ITC amount with interest and will never be again benefited with ITC. But, now with the amendment, the time period has been extended to 180 days and the term goods has been added to it. Also, if the buyer pays the goods and service provider after 180 days the buyer can again avail the ITC.
• Tax input credit was earlier not allowed on rented cabs, life insurance as well as health insurance business which led to many problems. But now ITC will be allowed if the sale is made for the same category of service and is not a mixed supply.
• Indian women lives have been made easy by removing the GST from sanitary napkins.
• GST percentage has come down to 5 percent from 18 percent in case of e-books.
• Reduction in the rate of ethanol will indirectly lower the rate of the products in which ethanol is majorly used especially in the blending of petrol.
• GST appellate tribunal bench is created where the national bench will be set up at New Delhi and Mumbai, Chennai, Kolkata will be coming up with many area benches
• Process of the Return filling has been made easier than before. Taxpayers who have more than 5 crore turnover have to file the returns monthly but the taxpayers having less than 5 crore turnover can pay the tax on a quarterly basis.

GST has played an important role in the Indian economy. With the recent amendments introduced, the GST process has been made easier, boosted the performance of the manufacturing sector.