GOODS AND SERVICE TAX

INTRODUCTION
GST is an Indirect Tax which has replaced many Indirect Taxes in India. The Goods and
Service Tax Act was passed in the Parliament on 29th March 2017. The Act came into effect
on 1st July 2017; Goods & Services Tax Law in India is a comprehensive, multi-
stage, destination-based tax that is levied on every value addition.
In simple words, Goods and Service Tax (GST) is an indirect tax levied on the supply of
goods and services both except taxes on the supply of the liquor for human consumption.
Further the clause 366 (26A) of the Bill defines Services means anything other than Goods.
GST is one indirect tax for the entire country. The introduction of the Goods and Services
Tax (GST) is a very significant step in the field of indirect tax reforms in India. By
amalgamating a large number of Central and State taxes into a single tax, GST will mitigate
ill effects of cascading or double taxation in a major way and pave the way for a common
national market.

Certain Non-GST goods such as:

(i) Petroleum crude
(ii) High-speed diesel
(iii) Motor spirit (commonly known as petrol);
(iv) Natural gas
(v) Aviation turbine fuel and
(vi) Alcoholic liquor for human consumption

There are 3 taxes applicable under this system: CGST, SGST & IGST.

 CGST: Collected by the Central Government on an intra-state sale (Eg: transaction

happening within Maharashtra)
 SGST: Collected by the State Government on an intra-state sale (Eg: transaction
happening within Maharashtra)
 IGST: Collected by the Central Government for inter-state sale (Eg: Maharashtra to
Tamil Nadu)

GST rates in India at a glance:

Exempted categories: 0
Commonly used Goods and Services: 5%

Standard Goods and Services fall under 1st Slab: 12%

nd
Standard Goods and Services fall under 2 Slab: 18%
 Special category of Goods and Services including Luxury Goods: 28%

OBJECTIVES

 To learn about GST registration process

 To learn how to file GST returns
 To help clients in registration process
 To help clients in downloading the offline return software

IMPORTANCE OF GST

 Will help in reducing tax evasion:

All the distributors will prefer purchase with invoices, because that would give them better
profit margins as the distributor will get credit of all the taxes paid at the previous stage.
Currently, it is the distributor who has to bear the burden of the excise duty. So if the
customer insists on taking the bill, we can presume that the tax evasion should fall. This will
indeed be the biggest advantage of GST.

 Removal of location bias approach:

GST would help to even out the tax structures across various states, omitting location bias.
As taxes should not be a hindrance to the investment decision of an individual, introduction
of GST would help an investor to put up business units in any state without the worry of tax
difference. This would boost the business in undeveloped locations as well.

 Lesser incentive for tax evasion:

Currently, taxes are being paid on the entire underlying value of a product or service, but with
GST, companies will have to pay tax only on the value-addition. This would lead to reduction
in the actual tax paid and also decrease the incentive for evasion.

 Unified market:

With the implementation of GST, there will be cut down of individual taxes imposed by the
central government as well by the states. This would lead to a unified market and would
boost the movement of goods across states with drop in the business costs.

 Increase in State revenues:

GST will expand the tax base and thereby lead to increase in the revenues available at the
states’ and centre’s disposal. This would thereby help in increasing the resources of the
poorer / consumer states like, Bihar, Uttar Pradesh and Madhya Pradesh will increase
substantially.

 Improvement in tax governance:

GST would improve tax governance in two ways. One it is related to self-policing incentive
inherent to a valued-added tax that can work very powerfully in the GST. The second relates
to the dual monitoring structure of GST, one by the States and the other by the Centre.

RESEARCH METHODOLOGY

Universe of Study: For the present study purpose about the Perception of new implemented
system of Goods and Service Tax.

Sample Design: The complete study of all items in the population is known as a census inquiry.
Sample is a group of few items, which represents the population is or universe from where it
is taken. The Process of Selecting sample have been Multi Stratified in Nature. At the first
Stage 2 blocks of region / area have been selected with the help of convenient sampling. At
the 2nd Stage 25 respondents have been selected from these blocks with the help of Simple
Random Sampling. The size of sample is 50 respondents.
Sample Size: The sample size of the study was 50. The responses were captured from
respondents on a 5 point Likert scale.
Sampling Method: The sampling method was Judgment Sampling (only those respondents
were chosen who had some knowledge about GST)

Data Collection:
Data collection is the process to gather information about the relevant topic research,
which is be Data Collection usually takes place early in an improvement project, and is
often formalized through data collection plan which often contains the following activity:

 Pre collection activity on goals, target data, definitions and methods.

 Collection of Data.
 Presenting findings involving some form of sorting analysis.
For accomplishing the objective of study, both Primary and Secondary data have been used.
Data Collection through the Primary Data as well as Secondary Data Sources.

Classification of Data:
The correct information is the key to success. Data information is of two types:

 PRIMARY DATA
 SECONDARY DATA
Primary Data: The study is largely based on the primary data which has been collected
through the structured Questionnaire Method.
Using Primary Data Collection Tool
Questionnaire: The data has been collected by administering a structured schedule of
questions. The questions are generally framed by 5 point Likert Scale and answers by
respondents in form of Agree, Dis agree, Neutral, Strongly Agree and strongly dis Agree.
The Questionnaire have been prepared for study the customer perception towards the
 Goods and Service Tax. For the present study purpose questionnaire method is used to
collect the primary data. This questionnaire is self-administrated questionnaire and it is
divided into two sections – Section A and Section B.

 Section A consist the questions regarding Personal Information. For Eg. Name,
Age, Gender, Qualification, Marital Status, Occupation.
 Section B Consist the questions which fulfill the research objectives

Secondary Data:
This type of data has already been collected by someone else and has already passed
through statistical process. This type of data has been collected from the following
resources:

Sources of Collection of Secondary Data

1. Internet
2. Books
3. Journals
4. Thesis
5. News paper
6. Magazines etc.

Research Instruments:
Questionnaire A questionnaire is a research instrument consisting of a series of questions and
other prompts for the purpose of gathering information from respondents. Although they are
often designed for Statistical Analysis of the responses.

Research Plan:
 Data Source Primary Data
 Research Approach Survey
 Research Instrument Questionnaire
 Method of Contact Personal
 Sample Size 50 Respondents
Limitations of the study:
This study too has its limitations that limits the applicability and validity of study. The
limitations are below
1. The sample size was small and cannot be applied to the entire population.
2. GST is new launched tax system so some complications are faced by the peoples.