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TMI BlogPart C- First Discussion Paper on GST-2nd & 3rd SegmentX X X X Extracts X X X X X X X X Extracts X X X X ..... Part C- First Discussion Paper on GST-2nd & 3rd Segment X X X X Extracts X X X X X X X X Extracts X X X X ..... re of the GST model in India. * India is country which have a federal system in which Centre and State both have powers in their domain and legislation in which they operate. * Due to federal system, a Dual GST structure is recommended in India. * In Dual GST structure, Central and State will have pre-defined functions and responsibilities. * GST will have two components. One component wil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l be Central GST (CGST) which will be levied by Central and second will be State GST (SGST) which will be levied by States. * GST model will be implemented by multiple statutes i.e. one statute for CGST and one statute for SGST for respective state. * To make uniformity, basic features of law such as chargeability, taxable event and levy including valuation provisions etc. will be same across ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all statutes as far as practicable. * GST will be applicable on all transactions of goods and services made for a consideration. * In GST model, there will be exempted goods and services which will be out of GST purview. * A threshold limit will be also in GST model, below which no GST will be payable. For SGST a threshold limit of ₹ 10 lacs for both goods and services is suggested acr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oss all states. In case of CGST, threshold limit suggested for goods is ₹ 1.5 crore and in case of services, a higher limit is desirable. * The CGST and SGST will be paid separately to accounts of Central and state government respectively. * The CGST and SGST will be treated separately. In books of accounts, there will be separate accounts for the utilization or refund of credit. * Cro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss utilization of Input tax credit (ITC) between the CGST and SGST will not be allowed. * The Central government and State government would have concurrent jurisdiction in GST model. CGST will be administered by Central government and SGST will be administered by State government. * A Composition / Compounding scheme is also suggested in GST model. The Scheme should have an upper ceiling on gr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oss annual turnover and a floor fix rate. A cutoff at ₹ 50 lacs for gross annual turnover and 0.5% for floor rate is also suggested in the model. * GST model would also have an option of registration or not, in case of turnover below threshold limit fixed in GST. * There will be periodic returns which need to be submitted to CGST and SGST authorities. * A PAN linked tax payer identific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation number having 13/15 digits will be issued under GST model. * Assessment, Scrutiny, enforcement and audit powers will be vest with respective authorities i.e. in case of CGST; it will be done by Central GST authorities and in case of SGST, will be done by State GST authorities. * In GST regime, various Central Taxes and State Taxes will be subsumed in GST. * Central Taxes subsumed in GS ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T are Central Excise duty, Additional Excise duties, Excise duty levied under MTP Act, Service Tax, Additional Custom duty (CVD), Special additional duty (SAD), Surcharges and Cesses. * State Taxes subsumed in GST are VAT/Sales tax, Entertainment tax, Luxury tax, Taxes on lottery, betting and gambling, State Cesses and Surcharges related to supply of goods and services and Entry tax. Regarding P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urchase tax, it is not clear that whether it will be subsumed in GST or not. * Some specific provisions for specific commodities are also suggested. E.g. Alcoholic beverage, Petroleum products would be kept outside ambit of GST. * In case of Interstate transactions, IGST model is suggested. A highly IT infrastructure is required in this mode to align In IGST model, Centre would levy IGST which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would be CGST plus SGST on all interstate transactions of taxable goods and services. * In IGST model, appropriate provision will be for Consignment sale or Stock transfer of goods and services. * A two rate structure is proposed in GST model. One lower rate for necessary items and basic importance and a Standard rate for other items. Also a special rate for precious metal is also suggested. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... * There will be an exempted items list on which GST will not be payable. * Exports will be Zero rated in GST model. Same benefits will be available to SEZs. * Imports will be taxed in GST model. Both CGST and SGST will be levied on import of goods and services into India. * Any special industrial area scheme regarding tax exemption or remission will not be encouraged in GST model and all t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he existing scheme will be discontinue after a legitimate expiry time. X X X X Extracts X X X X X X X X Extracts X X X X
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