GST Full Form
This write-up will take you through the detailed information on GST and GST Full Form. After you have gone through this write-up, you will know and understand the full form and meaning of GST.
Alongside, explore the different types of GST under the GST taxation system.
We have also included the tax slabs and rates with some of the goods and services under the tax rate slab.
Also, know the benefits of GST for trade, consumer, and economy.
What is the full form of GST?
GST is used as an abbreviation for the Goods and Services Tax.
Related Topic :- What is TDS?
What is GST?
Goods and Services Tax is a single and unified tax consumption-based tax that is levied based on the “Destination Principle”.
India has a dual GST model with taxes imposed by the Central and States concurrently.
GST was introduced and implemented in India on 1st July 2017. Therefore, 1st July is observed as GST day.
India has the highest tax slab of 28% in the world. It has four rate structures viz. 5%, 12%, 18% and 28% with a cess on sin goods and luxury items.
The GST Bill was introduced under the 122nd Constitutional Amendment Bill and Assam was the first state to ratify GST Bill.
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What are the types of GST?
According to the GST system, there are four types of GST which are as follows:-
The Central Goods and Services Tax is levied on intrastate transactions. The CGST Act governs CGST and the tax is collected by the central government.
The State Goods and Services Tax is levied on the transactions within the state. In this situation, SGST and CGST are levied. SGST is levied by the state and solely claimed or collected by the respective state.
The Integrated Goods and Services Tax is levied on interstate supply of goods and/or services. It is also applicable to exports and imports.
The central government is responsible for collecting the taxes under IGST which are further divided among the respective states.
Union Territories Goods and Services Tax is applicable to goods and/or services that are supplied to the Union territories.
The revenue or tax earned is collected by the Union territories. IT is levied alongside CGST in UTs. It is also known as a replacement of SGST in Union Territories.
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What are the 4 slabs of GST?
|Packaged food items Skimmed milk powder Cream Frozen vegetables Kerosene Fertilizers Small restaurants Medicine Coal Cashew nuts Pizza bread Tea Spices Rail and economy class air tickets Branded paneer Apparel below Rs 1000 Footwear below Rs 500||Frozen meat products Ghee, Cheese, butter Packages dry fruits Ayurvedic medicines Tooth powder Fruit juices Cell phones Diagnostic kits Indoor games Umbrella Sewing machines Spectacles Business class air tickets Apparels above Rs 1000||Bakery items Jams, soups, ice cream Preserved vegetables Mineral water Electronics Notebooks Sanitary napkins AC restaurants IT services Financial services||Edibles Chocolates Personal care items Vacuum cleaner Washing machine Hotel stays Private lottery Race club betting Aerated drinks Movie tickets above INR 1000|
What are the benefits of GST?
- It helps in reducing the multiplicity of taxes
- Enables more efficient neutralization of taxes
- GST helps in mitigating the cascading or double taxation system
- It is a simpler tax regime and leads to the development of a national market
- There are fewer rate slabs and exemptions under GST
- There is no need for distinction between goods and services
- As cascading is eliminated, the prices of goods and services have been reduced
- It is a simpler tax system to follow and understand
- Offer the benefit of uniform pricing throughout the country and transparency in the taxation system
- It leads to a rise in employment opportunities
- The uniform IGST and SGST rates contribute to reducing the incentive for tax evasion
- GST has created a unified common market in India that has boosted the foreign investment and “Make in India” campaign
- Eliminates poverty issues to an extent by generating employment opportunities
- Enhances the manufacturing and export initiatives and activities and contributes to the substantive economic growth
- With input tax credit available at every stage of supply, it prevents cascading
- Reduces the average tax burden and harmonizing the rates, laws and tax procedures
- Benefiting for the environment owing to the online procedures
- Common procedures for various processes and timelines for important activities
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