Professional Documents
Culture Documents
Goods and Service Tax
Goods and Service Tax
GST
May 2017
1
Contents
Introduction to GST :
• Taxes subsumed/ not subsumed under GST
• Basic Structure, coverage
• Rates
• Input Tax Credit
• ASP, GSTN, GSP
Impact on Distributor
Impact on Retailer
Miscellaneous
FAQs
2
Introduction to
GST
GST
3
Taxes subsumed under GST
Surcharges &
Cesses
GST CST
Taxes on
lottery, Entertainment
betting & Tax (not by specified Luxury Tax Service Tax
gambling bodies) 4
Taxes not subsumed under GST
Stamp Duties,
Taxes on lands
and buildings,
electricity
Toll tax,
GST
Taxes on carriage
Basic Customs by rail/ waterways/
Duty, road
Export Duties
Model of GST
Zero 28% +
5% 12% 18% 28%
rated add cess
Goods/
Services
Essential are Not
conditions for received listed as
claiming Input ineligible
Credit : for
Receipt credits
of Tax
Payment invoice
Payment
to made
of Tax by
within
Supplier
180 days Supplier
uploads
details in
GSTR1
9
ASP, GSTN, GSP
34 GSPs notified
10
Need for ASP
Validate,
summarise
Sales data
Preparing for Sign Upload
and filing off signed off
data in
monthly
GSTR-1
GSTR-3 Download
format on
return GSTR-2A
GSTN
(Sales data
uploaded by
Send suppliers) Reconcile
GSTR-2 to from GSTN purchase
GSP for data from
uploading Add non-auto co. with
populated GSTR-2A
on GSTN transactions
(imports,
reverse
charge, etc.)
to GSTR-2A
11
Impact on Marico to
Distributors
12
Impact on Marico to Distributors
Invoice
Marico GST no.
• All distributors must register under
Distributor GST no. GST
• GST no. of distributor missing … Input
tax credit not available to him
13
Claims
16
Impact on Distributors to Retailers
• Changes in Invoice format
Invoice • Standard format will be rolled out
Distributor GST no.
• Retailers who wish to avail input tax
Retailer GST no. credit … Register under GST
• Details to be updated in MIDAS
• GST no. of retailer missing … Input tax
credit not available to retailer
17
Price Cascade (Impact on Retailer)
Particulars Current under VAT Revised under GST
Distributor to Retailer to Distributor to Retailer to
Retailer Consumer Retailer Consumer
MRP
Benefits
Limited tax liability … Nominal tax rate of 1%
Limited Compliance … Quarterly return instead of monthly return
Better Liquidity
19
Price Cascade (Impact on Retailer)
Particulars Current under VAT Revised under GST
Distributor to Retailer to Distributor to Retailer to
Retailer Consumer Retailer Consumer
MRP
21
Impact on Modern Trade
Invoice
Marico GST no.
• All customers must register under GST
Customer GST no. • GST no. of customer missing … Input
tax credit not available
Assuming GST rates are higher than VAT rates, overall Chain
profit to fall 22
Miscellaneous
23
Transitional issues – duty credits on closing stocks
VAT Input tax Credit … VAT paid on purchases would be available as Input Tax credit 24
Actionable for Distributors
Self-
registration
Filing of
return for
opening stock
Actionables Credit within
Selection 60 days of
transition date
of
ASP/GSP
for Raising of
Generation compliance service
of E-way Bill
invoices
for all
Updation under
movements
of Retailer GST
master
with GST
no. of
retailer 25
Actionable for Sales Team
Drive
registration
• Distributor
• Wholesaler
• Stockiest
• Retailer
Actionables under GST
Learning on
GST – Basic
& FAQ’s
Remove
ambiguity in
minds of
wholesaler/
retailer :
fear of unknown
26
Potential Challenges and Business Risks
Education,
awareness
of
Distributor,
Distributor and
opting for managing VAT
Composition Associations reimbursem
Tax may lead ent on
to higher cost Reduction in opening
of business to stock
absolute
Marico
retailer
earnings due
Opening
Stock
to higher Wholesalers
GST rate Compliance
reconciliation
increasing,
with
leading to
distributor
higher cost of
(excise De- business
benefit)
stocking
before
GO-LIVE
27
FAQs
28
FAQs … Distributor
Q. Is registration mandatory?
A. Registration is mandatory in following conditions:
Annual turnover exceeds INR 20 lacs
Inter State Sales
29
FAQs … Distributor
Q. What happens to the stock lying on the date of transition?
A. Following credit is available
VAT credit as per return will be carried forward under GST. Hence no loss
Excise duty @ 40% of CGST rate is allowed as credit (except for exempted
goods)
30
FAQs … Distributor
Q. Can I do bill modification post supply?
A. No bill modification is allowed under GST. Any subsequent changes must be
carried out through sales return module
31
FAQs … Distributor
Q. If I am registered under Composition scheme, will invoice format be
different?
A. Yes, tax cannot be displayed on invoice. Tax cost @ 1% will become additional
costs. Further, since there are services being rendered, hence composition
scheme will not apply
32
FAQs … Distributor
Q. What are the changes in MIDAS?
A. There are various changes in MIDAS. Highlighting the same as under:
Invoice format will change
Debit note for services will get converted to Service invoice
VAT report will be changed to GST report.
We will provide separate training session on MIDAS
33
FAQs … Wholesaler/ Retailer
Q. Will the Company reimburse the loss incurred due to higher GST rate on
opening stock?
A. Government has provided credit on opening stock for VAT and Excise. We do
understand that same would not entirely compensate for the difference.
Historically, such cost have always been subsumed in the margins which
company provides
Q. In case I have multiple firms with multiple registration, will the Company
register them separately?
A. There is no restriction on registration of multiple retail/wholesale outlets.
34
Thank You!
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