Goods and Services Tax (GST)

Unit V
 GST
Indirect tax
Introduced in India on 1 July 2017
Applicable throughout India
Replaced multiple cascading taxes levied by
the central and state governments.
The government has categorised items in five
major slabs - 0%, 5%, 12%, 18% and 28%.
Central GST
Applicable on supplies within State
Tax collected will be shared to the Centre

State GST
Applicable on supplies within State
Tax collected will be shared to the State

Union Territory GST

Applicable on supplies within Union Territory
Tax collected will be shared to the Union Territory

Integrated GST
Applicable on inter-state and import transactions
Tax collected will be shared between State & Centre
 0%
Jute, eggs, milk, butter milk, curd, natural
honey, fresh fruits and vegetables, flour,
stamps, printed books, newspapers, Salt,
Khadi purchased from Khadi and Village
Industries stores
0.25%
Rough precious and semi-precious stones
 5%
Apparel below Rs 1000, packaged food items,
footwear below Rs 500, branded paneer, frozen
vegetables, coffee, tea, spices, pizza bread,
kerosene, coal, medicines, Ice and snow, branded
Namkeens, Ayurvedic, Unani, Siddha,
Homeopathy medicines, etc. All restaurants
Services
All restaurants, restaurants of hotels with room
tariff of less than Rs 7,500, Food parcels, Textile
job work, Transport services (Railways, air
transport); Supply of e-waste
 12%
Apparel above Rs 1000, frozen meat products ,
butter, cheese, ghee, dry fruits in packaged form,
animal fat, sausage, fruit juices, namkeen,
Ayurvedic medicines, tooth powder, agarbatti,
colouring books, picture books, umbrella, sewing
machine, cellphones, Ketchup & Sauces, All
diagnostic kits and reagents, Exercise books and
note books, Spoons, forks, Spectacles
Services
State-run lotteries, Non-AC hotels, business class
air ticket, fertilizers, Work contracts
 18%
Most items are under this tax slab which include
footwear costing more than Rs 500, Trademarks,
goodwill, software, Biscuits (All categories), pasta,
cornflakes, pastries and cakes, preserved vegetables,
jams, sauces, soups, ice cream, instant food mixes,
mineral water, tissues, envelopes, note books, steel
products, camera, speakers
Services
Restaurants in hotel premises having room tariff of
Rs 7500 and above, telecom services, IT services,
branded garments and financial services, Outdoor
catering.
 28%
50 luxury and sin products will be taxed at 28%
which includes Bidis, molasses, pan masala,
aerated water, paint, sunscreen, wallpaper,
ceramic tiles, water heater, dishwasher, weighing
machine, washing machine, ATM, vending
machines, vacuum cleaner, automobiles,
motorcycles, aircraft for personal use
Services
Private-run lotteries authorized by the states,
race club betting, cinema will attract tax 28 per
cent GST
 Registered Dealer
Any business in India that supplies goods or
services with turnover exceeding Rs. 20 lakh
(Rs. 10 lakh for North Eastern and hill states)
has to get registered under GST.
Businesses registered under any of the pre-
GST laws: VAT, Excise/Service Tax have to
register under GST by default.
 Businesses that need to register under GST
irrespective of their turnover
Every person who is registered under the Pre-GST law (i.e.,
Excise, VAT, Service Tax etc.) needs to register under GST.
When a business which is registered has been transferred to
someone, the transferee shall take registration with effect
from the date of transfer.
Anyone who drives inter-state supply of goods**
Casual taxable person
Non-Resident taxable person
Agents of a supplier
Those paying tax under the reverse charge mechanism
Input service distributor
Person who supplies via e-commerce aggregator
Person supplying online information and database access or
retrieval services from a place outside India to a person in
India, other than a registered taxable person
 Composition Dealer
Businesses dealing only in goods can only opt
for composition scheme. Services providers
have been kept outside the scope of this
scheme. However, restaurant sector taxpayers
may also opt for the scheme.
This holds true if your annual turnover is
below Rs 1.5 crore*.
 GSTIN
All businesses that successfully register under
GST are assigned a unique Goods and Services
Tax Identification Number also know
as GSTIN.
 GSTN
The Goods and Service Tax Network (or GSTN) is a
non-profit, non-government organization. It will
manage the entire IT system of the GST portal,
which is the mother database for everything GST.
This portal will be used by the government to track
every financial transaction, and will provide
taxpayers with all services from registration to
filing taxes and maintaining all tax details.
Private players own 51% share in the GSTN, and the
rest is owned by the government. The authorized
capital of the GSTN is Rs.10 crore (US$1.6 million), of
which 49% of the shares are divided equally
between the Central and State governments, and
the remaining is with private banks.
 Return Filing
Return filing is mandatory under GST. Even if
there is no transaction, you must file a Nil
return.
You cannot file a return if you dont file
previous month/quarters return.
Hence, late filing of GST return will have a
cascading effect leading to heavy fines and
penalty.
 Late Fee & Interest
Interest is 18% per annum. It has to be calculated by
the tax payer on the amount of outstanding tax to
be paid. Time period will be from the next day of
filing to the date of payment.
Late fee is Rs. 100 per day per Act. So it is 100 under
CGST & 100 under SGST. Total will be Rs.
200/day. Maximum is Rs. 5,000. There is no late fee
on IGST.
For delayed filing of NIL returns, late fee reduced
from Rs 200 per day to Rs 20 per day.
Late fees for GSTR-3B of July, Aug and Sept waived.
Any late fees paid for these months will be credited
back in Electronic Cash Ledger under Tax and can
be utilized to make GST payments.
 Advantages of GST
Transparent tax and reduces number of indirect taxes
No hidden taxes and the cost of doing business will be
lower.
Prices will come down which in turn will increase
consumption
In the GST system, all the taxes are integrated, it would
make possible the taxation burden to be split equitably
between manufacturing and services.
Levy of tax only at the final destination of consumption
based on VAT principle and not at various points (from
manufacturing to retail outlets). This will help in
removing economic distortions and bring about
development of a common national market.
Help to build a transparent and corruption free tax
administration.
 Disadvantages of GST
Some Economist say that GST in India would impact negatively on
the real estate market.
Some Experts says that CGST(Central GST), SGST(State GST) are
nothing but new names for Central Excise/Service Tax, VAT and
CST. Hence, there is no major reduction in the number of tax
layers.
Some retail products currently have only four percent tax on them.
After GST, garments and clothes could become more expensive.
The aviation industry would be affected. Service taxes on airfares
currently range from six to nine percent. With GST, this rate will
surpass fifteen percent and effectively double the tax rate.
Adoption and migration to the new GST system would involve
teething troubles and learning for the entire ecosystem.
 23rd GST Council Meet on 10th
November 2017
GSTR-3B has been extended to March 2018
All businesses to file GSTR-3B by 20th of next
month till March 2018.
All businesses to file GSTR-1 and GSTR-3B till
March 2018.
GSTR-2 and GSTR-3 filing dates for July 2017 to
March 2018 will be worked out later by a
Committee of Officers
Turnover under Rs 1.5 Cr to file quarterly GSTR-1
Turnover above Rs 1.5 Cr to file monthly GSTR-1
 GSTR 1
GSTR-1 is a monthly or quarterly return that
should be filed by every registered dealer. It
contains details of all outward supplies i.e sales.
The due dates for GSTR-1 are based on your
turnover. Until March 2018 the due dates for the
return has been notified.
Businesses with sales of up to Rs. 1.5 crore will
file quarterly returns.
Other taxpayers with sales above Rs. 1.5 crore
have to file monthly return.
 GSTR 2
Every registered taxable person is required to give
details of Inward Supply, i.e., purchases for a tax
period in GSTR-2.
GSTR-2 contains details of all the purchases
transactions of a registered dealer for a month. It
will also include purchases on which reverse
charge applies.
The GSTR-2 filed by a registered dealer is used by
the government to check with the sellers GSTR-
1 for buyer-seller reconciliation.
There is a 5-day gap between GSTR-1 & GSTR-2
filing to correct any errors and discrepancies.
 GSTR 3
GSTR-3 is a monthly return with the
summarized details of sales, purchases, sales
during the month along with the amount of
GST liability.
This return is auto-generated pulling
information from GSTR-1 and GSTR-2.
GSTR-3 will show the amount of GST liability
for the month. The taxpayer must pay the tax
and file the return.
 GSTR 3B
GSTR-3B is a simple return form introduced by the
Central Board of Excise and Customs (CBEC) for July
2017 to March 2018.
GSTR-3B contains details of outward and inward
supplies. Need not provide invoice level information
in this form. Only total values for each field have to
be provided.
Separate GSTR-3B for each GSTIN have to be filed.
GSTR-3B has to be filed by 20th of next month till
March 2018. For example, due date of return for the
period November 2017 is 20th December 2017
 GSTR 4
GSTR-4 is a GST Return that has to be filed by
a Composition Dealer. Unlike a normal
taxpayer who needs to furnish 3 monthly
returns, a dealer opting for the composition
scheme is required to furnish only 1 return
which is GSTR-4.
GSTR 4 has to be filed on a quarterly basis.
The due date for filing GSTR 4 is 18th of the
month after the end of the quarter
 GSTR 5
Every registered non-resident taxable person
is required to furnish a return in GSTR-5 in GST
Portal.
It will contain all business details for non-
resident (NR) including the details of sales &
purchases.
Information from GSTR-5 will flow into GSTR-
2 of buyers.
 GSTR 6
GSTR 6 is a monthly return that has to be filed
by an Input Service Distributor.
It contains details of Input Tax Credit (ITC)
received by an Input Service Distributor and
distribution of ITC.
GSTR 6 has to be filed by every ISD even if it is
a nil return.
 GSTR 7
GSTR 7 is a return to be filed by the persons
who is required to deduct TDS (Tax deducted
at source) under GST. GSTR 7 contains the
details of TDS deducted, TDS liability payable
and paid, TDS refund claimed if any etc.
 GSTR 8
GSTR-8 is a return to be filed by the e-commerce
operators who are required to deduct Tax Collected
at Source (TCS) under GST.
GSTR-8 contains the details of supplies effected
through e-commerce platform and amount of TCS
collected on such supplies.
E-commerce operator is any person who owns or
manages the digital or electronic facility or platform for
electronic commerce such as Amazon, Flipkart, etc. The e-
commerce operator provides a platform whereby the
sellers can reach out to a large number of customers by
getting registered online on their platform.
 GSTR 9
GSTR 9 is an annual return to be filed once in
a year by the registered taxpayers under GST
including those registered under composition
levy scheme. It consists of details regarding
the supplies made and received during the
year under different tax heads i.e. CGST,
SGSTand IGST. It consolidates the information
furnished in the monthly/quarterly returns
during the year.
 GSTR 9
There are 4 types of return under GSTR 9 :
GSTR 9 : GSTR 9 should be filed by the regular
taxpayers filing GSTR 1, GSTR 2, GSTR 3.
GSTR 9A GSTR 9A should be filed by the persons
registered under composition scheme under GST.
GSTR 9B GSTR 9B should be filed by the e-commerce
operators who have filed GSTR 8 during the financial year.
GSTR 9C GSTR 9C should be filed by the taxpayers
whose annual turnover exceeds Rs 2 crores during the
financial year. All such taxpayers are also required to get
their accounts audited and file a copy of audited annual
accounts and reconciliation statement of tax already paid
and tax payable as per audited accounts along with GSTR
9C.
 GSTR 10
A taxable person whose GST registration is
cancelled or surrendered has to file a return in
the form of GSTR-10. This return is called as
final return.
GSTR 10 must be filed within three months
from the date of cancellation or date of
cancellation order whichever is later.
 GSTR 11
GSTR-11 is the return to be filed by the
persons who has been issued a Unique
Identity Number(UIN) in order to get refund
under GST for the goods and services
purchased by them in India.
 Unique Identity Number
Unique Identity Number is a special classification made for
foreign diplomatic missions and embassies who are not liable
to taxes in Indian territory.
The following organizations can apply for a UIN:
A specialized agency of the United Nations Organization
A Multilateral Financial Institution and Organization notified under
the United Nations (Privileges and Immunities) Act, 1947,
Consulate or Embassy of foreign countries
Any other person or class of persons as notified by the
Commissioner.
The above persons/organizations can apply for UIN using
Form GST REG- 13.
Purpose of UIN
The purpose of issuing UIN is that any amount of tax collected
from the bodies/person holding UIN is refunded back to
them. But in order to claim the refund of GST paid by them,
they need to file GSTR 11.