GST (Goods and Service Tax) in India is regarded as one of the largest taxations that has taken place in India and also passed by the Indian Government. India has adopted two GST that means GST will be administrated both by the State Government as well as by the Central Government.
In keeping the federal structure of India, it is proposed that the GST will be issued both by the Central Government (CGST) and the State Government (SGST). Prime Minister Narendra Modi introduced GST in India on the midnight of 1st July 2017.The development of GST took many negotiations as well as revisions before getting launched in India in its final form in the year 2017.
Goods and Service Tax (GST) is an indirect tax in India imposed when a customer buys a good. GST is regarded as an indirect tax imposed on the sale, manufacture, buying of goods. The aim of GST is to remove all the indirect taxes imposed on goods by the Indian Central governments and State governments.
There are three taxes that are applicable under the GST and they are as follows:
- CGST: CGST is the tax collected by the Central Government of India.
- SGST: SGST is the tax that is collected by the State Government of India.
- IGST: This is the tax that is collected by the Central Government of India for an inter- state sale.
The main objectives of GST in India are:
- To remove Indirect Tax issues.
- Increase the number of tax payers.
- To entertain consumption-based tax rather than manufacturing.
- Diminish Tax corruption.
The importance of Goods and Service Tax (GST) in India are:
- Abolishing of multiple numbers of indirect taxes like VAT, Service tax, CST, CAD etc.
- To control black money circulation.
- Increasing demands and consumption of goods.
- Improving the economy of India in the long run.
- Increasing demands will lead in the increase of supply and will help in rise of the production of goods.
- GST will abolish 17 indirect tax issued and hence life will get simpler.
- It will make manufactured goods cheaper.
- There will be easy and simple online procedure.
Besides, Goods and Service Tax (GST) in India is not only business friendly but friendly to consumer as well. Moreover, India has taken adoption of two GST model that means both the Central government as well as the State government can administrate it. Hence, GST increased both demand as well as consumption of goods which will improve the economy of India in the long run.