GST is finally hitting the Indian business sector on 1st July and this is the unified tax regime that will be introduced by the Indian Government.
The meaning of GST (Goods and Service Tax) is the unified indirect tax on goods and services. Taxes were levied at each stage separately at various rates under the Indian Taxation System.
Prior to this Centre and States were having rifts and now they have managed to break the deadlock on the issue of administrative control of taxpayers under the Goods and Services Tax, previously the tax was about to roll out on April 1 but now the date is postponed by July 1.
According to this decision, there is going to be massive revision of tax and this conclusion has been reached at the 9th meeting of all-powerful GST Council, states will have powers to assess and administer 90 per cent of the tax payers under Rs 1.5 crore annual turnover and for tax payers with more than Rs 1.5 crore turnover, states and the Centre will control and administer them in 50:50 ratio.
States would also have the powers to levy tax on economic activity within 12 nautical miles of territorial waters even though such rights constitutionally vest with the Centre. The power to levy and collect Integrated-GST, a tax on inter-state movement of goods and services, will lie with Centre but by special provisions in law, states will also be cross-empowered.
The GST Council will meet again on February 18 for further clarifications and for the finalizing the draft legislations.
Jaitley said once the drafts are cleared, they would go to the respective legislative bodies for approval. Officers will then work on the fitment of commodities into various tax slabs. “This will take us into the month of March,” he said, adding that trade and industry will also require adequate notice, while the GST Network would also have to be modified.
Initially, the GST is going to be time consuming process but once it is levied in the State Governments then we will have more clearer picture of it.