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Questions (FAQs) on
Goods & Services Tax- GST
Goods & Service Tax (GST)
What is GST?
GST means Goods & Service Tax. As the name itself says, it is a tax which is levied on either the goods or services. GST is a kind of Indirect Tax which been brought as a substitute to many other indirect taxes such as sales tax, excise, VAT, service tax etc. GST is governed since 1st July 2017.
At what rate is the GST Levied?
GST has 5 rates category and different kind of products or services have been classified under different categories for the purpose of GST computation. These 5 rate slabs of GST are : 0%, 5%, 12%, 18% & 28%. Besides, there is an exception category where due to some specific reasons a product is listed with a unique rate and that is applicable to only that product.
What are the types of GST?
If you look at some of bills & invoices on which you have paid GST, you would find 3 types or 3 components of GST appearing there. The 3 types of GST are - CGST (Central GST), SGST (State GST), IGST (Inter-state GST).
There is often confusion as which type of GST will be levied in what case. But the concept of GST levy is very simple. If the seller or the product or service and the buyer of the product and service both are the residents of the same state, then CGST & SGST are applicable whereas if the buyer and sellers reside in the different state, IGST is applicable.
The rate of IGST on the invoice is the same as per the GST slab of the category to which it belongs. Whereas in case CGST & SGST are to be levied, the GST slab rate is equally divided and put under CGST & SGST each.
How do I take care of GST operations for my individual business?
GST operations have been considerably tough. One, there have been quite frequent changes in the policy and operational procedures. Two,, technology side has been average or weak since the beginning. Third, there are very few GST advisors whom you can say that they are GST experts. GST accounting, filing, return, etc are all cumbersome and you must take the services of a Chartered Accountant (CA) who is a GST expert or GST taxation advisors who specialize in GST advisory. The GST advisors will make your operational things easier for you.