What is Goods and Services Tax (GST)?
GST is an indirect tax that is levied on goods as well as services. All the existing state and central indirect taxes are subsumed under the GST. It is applicable throughout the country. It is also referred to as “GST as One Nation One Tax”.
The tax came into effect from 1 July 2017 through the implementation of the One Hundred and First Amendment of the Constitution of India by the Indian government. The GST replaced existing multiple taxes levied by the central and state governments. There is no requirement for re-registration or renewal under GST, as it has no expiry. If the business is GST registered then you can avail the benefit of Input Tax Credit wherein you will have to pay only the difference between GST paid and payable by the business.
In case a transaction happens within the same state, then CGST and SGST are levied on the entities. In case a transaction happens between two different states, then IGST is levied on the entities.
Applicability of GST: To whom GST is applicable?
• GST is levied on the sale of goods and services.
• If in any financial year annual turnover exceeds Rs. 40 lakhs then you will have to
register for GST
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