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4-Unit Chapter-1 I) G ST Definition:: o The End-Consumer

GST is a consumption tax introduced in India in 2017 that unified indirect taxes. It aims to create a common national market, boost the economy through manufacturing and exports, reduce tax evasion, and simplify the tax system. Goods and services are divided into 5 tax rate slabs - 0%, 5%, 12%, 18%, and 28% - based on the type of item. The new tax system impacts consumers, traders and the economy positively by reducing prices, creating a uniform market, increasing employment and making the tax regime more transparent and efficient.

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542 views4 pages

4-Unit Chapter-1 I) G ST Definition:: o The End-Consumer

GST is a consumption tax introduced in India in 2017 that unified indirect taxes. It aims to create a common national market, boost the economy through manufacturing and exports, reduce tax evasion, and simplify the tax system. Goods and services are divided into 5 tax rate slabs - 0%, 5%, 12%, 18%, and 28% - based on the type of item. The new tax system impacts consumers, traders and the economy positively by reducing prices, creating a uniform market, increasing employment and making the tax regime more transparent and efficient.

Uploaded by

Mohamed Faizal
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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4- UNIT

CHAPTER-1

I) GST Definition:
 GST stands for Goods and Services Tax
 Goods and Service Tax (GST) is a type of tax introduced in
India from July 2017.
 GST is a consumption tax and paid by the end consumer of a
goods or service

The businesses and consumers pay GST on their purchases

 If the purchase was made by a business for sale to a customer


 Then the business can claim input tax credit to set-off GST
liability
 So the GST liability is pushed to the end-consumer

II) Impact of GST on Indian Economy


 Create unified common national market for India,
 Giving a boost to Foreign investment and “Make in India”
campaign
 Boost export and manufacturing leading to economic growth
 Help in poverty eradication by generating more employment
 Uniform SGST and IGST rates to reduce the incentive for tax
evasion

  III) Impact of GST on Consumers


 Simpler Tax system

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 Reduction in prices of goods & services due to elimination of
cascading
 Uniform prices throughout the country
 Transparency in taxation system
 Increase in employment opportunities

IV) Impact of GST on Traders


 Reduction in multiplicity of taxes
 Eliminate the double taxation through input tax credit
 More efficient neutralization of taxes especially for exports
 Development of common national market
 Simpler tax regime
 Fewer rates and exemptions
 Distinction between Goods & Services no longer required
V) GST Tax Rate Proportion:
i) Exempted GST Rate Slab (No Tax)
 7% of goods and services fall under this category
 The regular consumption include
a) fresh fruits and vegetables, milk, butter milk, curd,
b) natural honey, flour, besan, bread,
c) all kinds of salt,jaggery, cereal grains,
d) fresh meat, fish, chicken, eggs,
e) bindi, sindoor, kajal, bangles,
f) drawing and coloring books,
g) stamps, judicial papers, printed books, newspapers,
h) jute and handloom,
i) hotels and lodges with tariff below INR 1000 and so on

ii) 5% GST Rate Slab


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 14% goods and services fall under this category.
This slab includes below goods
a) Apparel below INR 1000,
b) Footwear below INR 500,
c) Packaged food items,
d) Cream and skimmed milk powder, branded paneer, frozen
vegetables,
e) Coffee, tea, spices, pizza bread, Rusk,
f) Sabudana, cashew nut, cashew nut in shell, raisin, ice, fish fillet,
kerosene, coal, medicine, Agarbatti
g) Postage or revenue stamps, fertilizers,
h) Rail and economy class air tickets, small restaurants, and so on.
iii) 12% GST Rate Slab
 17% of goods and services fall under this category.
a) Edibles like frozen meat products, butter, cheese, ghee,
b) Dry fruits in packaged form,
c) Animal fat, sausages, fruit juices, Namkeen, ketchup & sauces,
Ayurvedic medicines, all diagnostic kits and reagents,
d) Cell phones, spoons, forks, tooth powder,
e) Umbrella, sewing machine, spectacles,
f) Indoor games like playing cards, chess board, carom board,
g) Apparels above INR 1000,
h) Non-AC restaurants, business class air ticket,
i) State-run lottery, work contracts and so on attract a 12% GST.

iv) 18% GST Rate Slab


 43% of goods and services fall under this category.
a) Pasta, biscuits, cornflakes, pastries and cakes
b) Preserved vegetables, jams, soups, ice cream,
c) Mayonnaise, mixed condiments
d) Seasonings, mineral water,
e) Footwear costing more than INR 500,
f) Camera, speakers, monitors, printers, electrical transformer,
optical fiber,
g) Tissues, sanitary napkins,
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h) Notebooks, steel products, headgear and its parts,
i) Aluminum foil, bamboo furniture,
j) AC restaurants that serve liquor, restaurants in five-star and
luxury hotels, 
k) Telecom services, IT services,
l) Branded garments and financial services

v) 28% GST Rate Slab


 19% of goods and services fall under this category.
a) The edibles like chewing gum, bidi, molasses,
b) Chocolate not containing cocoa, waffles and wafers coated with
chocolate,
c) Pan Masala, aerated water,
d) Personal care items like deodorants, shaving creams, after
shave, hair shampoo, dye, sunscreen,
e) Paint, water heater, dishwasher, weighing machine,
f) Washing machine, vacuum cleaner,
g) Automobiles, motorcycles,
h) 5-star hotel stays, race club betting,
i) Private lottery and movie tickets above INR 100 etc.

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