GST is one indirect tax for the whole nation, which will make India one unified common market.

At the Central level, the following taxes are being subsumed: a. Central Excise Duty, b. Additional Excise Duty, c. Service Tax, d. Additional Customs Duty is commonly known as Countervailing Duty, and e. Special Additional Duty of Customs. At the State level, the following taxes are being subsumed: a. Subsuming of State Value Added Tax/Sales Tax, b. Entertainment Tax (other than the tax levied by the local bodies), Central Sales Tax (levied by the Centre and collected by the States), c. Octroi and Entry tax, d. Purchase Tax, e. Luxury tax, and f. Taxes on lottery, betting, and gambling.

Alcohol for human consumption, Petroleum Products viz. petroleum crude, motor spirit (petrol), high-speed diesel, natural gas and aviation turbine fuel& Electricity.

Tobacco and tobacco products would be subject to GST. In addition, the Centre would have the power to levy Central Excise duty on these products.

India is a federal country where both the Centre and the States have been assigned the powers to levy and collect taxes through appropriate legislation. Both the levels of Government have distinct responsibilities to perform according to the division of powers prescribed in the Constitution for which they need to raise resources. A dual GST will, therefore, be in keeping with the Constitutional requirement of fiscal federalism.

The Centre will levy and administer CGST & IGST while respective states will levy and administer SGST.

Under the GST regime, an Integrated GST (IGST) would be levied and collected by the Centre on inter-State supply of goods and services. Under Article 269A of the Constitution, the GST on supplies in the course of interstate trade or commerce shall be levied and collected by the Government of India and such tax shall be apportioned between the Union and the States in the manner as may be provided by Parliament by law on the recommendations of the Goods and Services Tax Council.

The CGST and SGST would be levied at rates to be jointly decided by the Centre and States. The rates would be notified of the recommendations of the GST Council.

Imports of Goods and Services will be treated as inter-state supplies and IGST will be levied on import of goods and services into the country. The incidence of tax will follow the destination principle and the tax revenue in the case of SGST will accrue to the State where the imported goods and services are consumed. Full and complete set-off 14 15 will be available on the GST paid on import on goods and services.

GSTN stands for Goods and Service Tax Network (GSTN). A Special Purpose Vehicle called the GSTN has been set up to cater to the needs of GST. The GSTN shall provide a shared IT infrastructure and services to Central 14 15 and State Governments, taxpayers, and other stakeholders for the implementation of GST. The functions of the GSTN would, inter alia, include: (i) Facilitating registration; (ii) Forwarding the returns to Central and State authorities; (iii) Computation and settlement of IGST; (iv) Matching of tax payment details with banking network; (v) Providing various MIS reports to the Central and the State Governments based on the taxpayer return information; (vi) Providing analysis of taxpayers’ profile; and (vii) Running the matching engine for matching, reversal and reclaim of an input tax credit. The GSTN is developing a common GST portal and applications for registration, payment, return, and MIS/ reports. The GSTN would also be integrating the common GST portal with the existing tax administration IT systems and would be building interfaces for taxpayers. Further, the GSTN is developing back-end modules like assessment, audit, refund, appeal, etc. for 19 States and UTs (Model II States). The CBEC and Model I States (15 States) are themselves developing their GST back-end systems. The integration of the GST front-end system with back-end systems will have to be completed and tested well in advance for making the transition smooth.

The Supply of goods and/or services is a taxable event. CGST & SGST will be levied on intra-state supplies while IGST will be levied on inter-state supplies. The charging section is section 7 (1) of the CGST/SGST Act and Section 4(1) of the IGST Act.

No, reverse charge applies to supplies of both goods and services.

The receiver of goods will not be able to get ITC. Further, the recipients who are registered under composition schemes would be liable to pay tax under reverse charge.

No, a taxable person under the composition scheme is not eligible to claim an input tax credit.

No, the composition scheme is applicable subject to the condition that the taxable person does not affect interstate supplies.