What is GST?

GST full form is Goods and Services Tax which has incorporated the various indirect taxes in India for the supply of goods and services. It was launched on the 1st of July 2017 to subsume all multiple indirect taxes at both the central and state levels.

GST is a single tax that combines various taxes, including:

1. Central Excise Duty
2. Service Tax
3. Value-Added Tax (VAT)
4. Sales Tax
5. Octroi
6. Entry Tax

GST has the following key features:

1. Dual GST: In India, the central and state governments collect GST under the following heads: Central GST (CGST) and State GST (SGST).
2. Multi-stage tax: GST is charged from the manufacturer, transportation to the consumer channel.
3. Input Tax Credit (ITC): ITC means that businesses can recover the tax imposed on inputs through adjustments within their tax returns for the tax charged on outputs.
4. GST Rates: GST rates are categorized according to the kind of supply and can be as low as 0% and as high as 28%.

GST has several benefits, including:

1. Simplified tax structure: GST unifies the existing complex structure of taxation as it substitutes many taxes with a single one.
2. Reduced tax burden: It also helps to reduce tax by removing the cascading taxes on the business entities, as well as to the end consumers.
3. Increased transparency: Records are considered an important factor because GST demands businesses to provide record-related details of their transactions.
4. Improved compliance: Compliance is too maintained through incentives of registration and filing of returns as encouraged by GST.

At the central level, GST is the monumental reform in the Indian taxation system intended to enhance growth and provide ease in compliance with the law with transparency.

Types of GST

Four main types of GST in India:

1. Central Goods and Services Tax (CGST): This kind of GST is charged by the central government on the movement of goods and services within a state. On the other hand, the CGST money collected is received by and utilized by the central government.
2. State Goods and Services Tax (SGST): This type of GST is charged by the state government on the going on of the supply of goods and services in a particular state. Our proposed model reflects that the revenue collected from SGST is utilized by the state government.
3. Integrated Goods and Services Tax (IGST): This type of GST is imposed by the center on the inter-state movement of goods and /or provision of services. The revenue generated from IGST is divided between the central tax and the state tax which is compensated to the government.
4. Union Territory Goods and Services Tax (UTGST): This kind of GST is implemented by the central government on the movement of goods and supplied services in the union territory of India like Chandigarh, Delhi, Puducherry etc.

Such types of GST also provide that the tax share is divided between the central and state Government and the tax share is distributed in the nation.

What are the five different GST rates?

In India, there are five types of GST rates, which are:

1. 0% GST Rate: This rate applies only to scheduled and basic items by fixing them at this rate:
   – Fresh fruits and vegetables
   – Milk and dairy products
   – Healthcare services
   – Education services
2. 5% GST Rate: This rate is charged on the necessities of life which includes:
   – Food grains
   – Pulses
   – Sugar
   – Spices
   – Tea and coffee
3. 12% GST Rate: This rate is levied on non-essential but popular goods and services hence the following;
   – Non-essential food items
   – Soaps and detergents
   – Toothpaste
   – Haircare products
4. 18% GST Rate: This rate applies to all such products and services that are in the luxury category or products that are priced high, for instance:
   – Air conditioners
   – Refrigerators
   – Washing machines
   – Televisions
   – Computers and laptops
5. 28% GST Rate: This rate applies to all luxuries and those articles that are costly such as:
   – Luxury cars
   – Jewelry
   – Perfumes
   – Cosmetics
   – High-end electronics

It is important to note that, some goods and services also attract an additional cess on top of the GST rate.

Collection authority of GST

The exacting committee of GST is the Central Board of Indirect Taxes and Customs (CBIC) and the State Tax Authorities.

Here’s a breakdown of the collection authority of GST:

CBIC (Central Government):

– Intakes CGST which is the Central Goods and Service Tax as well as IGST which is Integrated Goods and Service Tax.
Mainly concerned with the collection of GST on interstate sales and imports

State Tax Authorities (State Governments):

Also, gathers SGST (State Goods and Services Tax)
Amendments to the act are as follows – responsible for GST collection on intra-state supplies.

In addition to CBIC and State Tax Authorities, GST collection is also facilitated by:

• GST Network (GSTN): A charitable institution that offers the IT support system for GST Registration, Return Filing, and Payments.
• Authorized Banks: Authorized banks by law to receive GST and remit the same to the account of the government.
• GST Suvidha Providers (GSPs): All those private companies that are involved in offering any sort of GST-related services to the respective taxpayers like filing of returns and payment.
• Education services: 2. 5% GST Rate: This rate applies to G and S of lower order, which includes consumer goods and services defined as the goods and services that the majority of the population consumes.

How to apply for a GST number?

To apply for a GST number, also known as a GSTIN (Goods and Services Tax Identification Number), follow these steps:

Online Application

1. Visit the GST Portal: Access the current GST website via (link).
2. Click on “Register Now“: Go to the home page take your cursor to the “Taxpayers” tab on the header part of the page and click on the “Register Now” button displayed on the drop-down list.
3. Select “New Registration“: Select New Registration from the options that appear on the drop-down list.
4. Enter Your Details: Input essential company information, such as the business name, physical address, and telephone number or email.
5. Upload Documents: Please scan and upload necessary documents as desired by the websites like PAN card/ Aadhaar card/Proof of Business Ownership.
6. Verify Your Email and Mobile Number: You also have to confirm your email address and mobile number which is done through the OTP sent by the GST portal.
7. Submit Your Application: Complete the application and application fee (where applicable) and submit the documents.

Required Documents

• PAN card
• Aadhaar card
• Partnership deed and incorporation certificate specifically for the holder of the business.
• Passport-size photograph of the applicant.
• Bank account details

Offline Application
If you wish to file the form manually, you can go to a GST Seva Kendra (GSK) or GST Facilitation Centre (GFC) of your choice. These centers will help you apply and assist with applying.

Application Status
You can check the status of your GST registration by using the login details on the GST portal once you have applied. If your application is successful, you will receive the GSTIN to transact in compliance with the GST laws.