The Goods and Services Tax (GST) is all set to roll out on the midnight of 30 June.

Amid
all the fanfare and the headlines spread across front pages, if youre itching to ask some
basic questions but are too embarrassed, heres your one-stop shop.

1. What Is GST?
GST or the Goods and Services Tax is a single indirect tax that is expected to replace the
existing system of multiple indirect taxes making way for a pan-India, comprehensive
system.

Unlike before, there will now be a single tax on the supply of goods and services, from
the manufacturer to the consumer.

2. What Is GST's Impact?

The main aim of GST is to end multiple taxation at different levels of the supply chain.
Earlier for instance, if you're a resident of Madhya Pradesh but purchased a car in Tamil
Nadu, you would be taxed several times there'd be the Tamil Nadu state tax, followed
by Excise Duty, followed by sales tax. Once GST rolls out, several other indirect taxes
will be done away with.

GST will clearly be demarcated into two portions one for the Centre and one for the
state in question.

3. Which Central and State Taxes Are Subsumed

Under GST?
The GST would replace the following taxes. Taxes currently levied and collected
by the Centre

Central Excise Duty

Additional Excise Duties

Duties of Excise (Medicinal and Toilet Preparations)

Service Tax

Additional Duties of Customs (commonly known as CVD)

Special Additional Duty of Customs (SAD)

Central Surcharges and Cesses so far as they relate to supply of goods and services

State taxes that would be subsumed under the GST are:

 VAT/Sales tax

Entertainment tax (unless it is levied by the local bodies)

Luxury tax

Taxes on lottery, betting and gambling

State Cesses and Surcharges in so far as they relate to supply of goods and services

Entry tax not in lieu of Octroi

Purchase tax: Purchase tax was exempted from this list as several states benefiting
from it thought they would be devoid of substantial revenue if it were to be subsumed. It
was eventually decided that in case the tax has to be subsumed, adequate compensation
would have to be paid to the states. The issue is currently being discussed with the
government.

4. Benefits of GST
The GST system is meant to be more efficient in its application and distribution. After 1
July, items will be taxed according to the category they have been put in. This means
that the supply of an item will now be unhindered by state boundaries and taxes.
Reduced tax burden means the price of many items will reduce for the consumers.

According to research agencies, once GST is ironed out and on track, it could contribute
to a GDP growth by 1.5 percent in the long run.

5. What Are the GST Categories?

There are seven GST categories in total:

1. 28%

2. 18%

3. 12%

4. 5%

5. 3%

6. 0.25%

7. 0 (Exempt)
6. What Are the Items Not Affected by GST?
Crude oil, diesel, petrol, natural gas and jet fuel are currently not under GST. These
items have been put under the 0 percent category, but will continue to be taxed under
the old tax regime.

When and how these items will be included under GST is for the GST Council to decide.
Also Read: 'Business Hit Due to Confusion': Is Old Delhi Prepared For GST?

7. How Does the GST Council Function?

No decision can be taken by the council without the agreement of the Centre and the
states. To pass any decision, the GST council needs to garner 75 percent votes. While the
Central governments vote will have one-third weightage, the votes of all states put
together will be two-third.

The council will also be the arbitrator of disputes between the Centre and the state, or
between states, and will have the final say in the matter.

8. Where Do You Register for the GST?

The Goods and Services Tax Network (GSTN) is a non-governmental private
organisation which will provide I-T infrastructure and support to the government,
taxpayer and other service providers for the implementation of GST. The government
has a 24.5% stake in the GSTN.

9. Relaxation in Rules for Two Months

The council has relaxed the tax filing norms for two months July and August for
those maintaining manual records or still in transition for GST. The government has a
simplified form instead of invoice returns, and there will be no penalties for late returns.
Regular returns need to filed from September onward.