Unit - IV

Introduction
• GST would also make our products
competitive in the domestic and international
markets.
 Constitution of GST
• Chairperson – Union FM
• Vice Chairperson - to be chosen amongst the Ministers
of State Government
• Members - MOS (Finance) and all Ministers of Finance /
Taxation of each State Quorum is 50% of total members
• States - 2/3 weightage and Centre - 1/3 weightage
• Decision by 75% majority
• Council to make recommendations on everything
related to GST including laws, rules and rates etc
 Expansion
• CGST - Central Goods & Services Tax
• SGST - State Goods & Service Tax
• GST - Goods and Service Tax
 Objectives of GST
• Ensuring the cascading effect of tax on tax will
be eliminated
• Reducing the tax slab rates to avoid further
clarification issues
• Ensuring the availability of input credit across
the value chain
 Benefits of GST
• Overall reduction in prices for consumers
• Reduction in Multiplicity of Taxes
• Uniform rate of tax
 Features of GST
• Supply of goods or services
• consumption taxation
• It would be a dual GST with the Centre and the
States simultaneously levying it on a common base.
Union territories without legislature would levy
Union territory GST (union territory tax- UTGST).
• An Integrated GST (integrated tax- IGST) would be
levied on inter-State supply (including stock
transfers) of goods or services.
 Role of CBEC
(Central Board of Excise and Customs)

• Now CBEC as converted into CBIC (Central board of Indirect tax and
customs)
• Role in Policy making
• Drafting of GST Law
• Rules & Procedures CGST, UTGST & IGST Law Assessment, Audit, Anti-
evasion & enforcement under CGST, UTGST & IGST Law Levy & collection
of Central Excise duty on products outside GST
• Petroleum Products & Tobacco Levy & collection of Customs duties
Developing linkages of CBEC
• GST System with GSTN
• Training of officials of both Centre & States
• Outreach programs for Trade and Industry
 Models of GST
1. Centre GST
2. State GST
3. Dual GST
 Hurdles in Implementation of GST
• Dispute between centre and Tax over Tax
Sharing Highly sophisticated IT infrastructure
required .
• Issue of taxing e-commerce is to be
appropriately addressed and integrated.
• Political Imbalance
 Reasons for GST in India
1. The current indirect tax structure is full of
uncertainties due to multiple rates.
2. Due to multiple rates there are multiple
forms.
DISPUTE SETTLEMENT AUTHORITY(DSA)

• Dispute between state and centre will be

handled by the DSA.
• Appeal from DSA would be dealt with
supreme court.
• Example: if a state receives less revenue in
comparison with its previous one than it can
appeal this case to the DSA
 GST Global Scenario
• More than 140 countries have already
introduced GST/National VAT. France was the
first country to introduce GST system in 1954.
Typically it is a single rate system but
two/three rate systems are also prevalent.
Canada and Brazil alone have a dual VAT.
Standard GST rate in most countries ranges
between 15-20%.
 Advantages of GST
• As a developing country, india needs a
transparent & unambiguous tax structure
• A complex tax structure with multiple rates of
taxes
• Multiple taxes across the supply chain
• High transaction cost in the hands of the tax
payers
• Increased tax collections due to wider tax base
and better compliance
• Improvement in international cost competitiveness
of indigenous goods and services.
• Enhancement in efficiency in manufacture and
distribution due to economies of scale
• GST encourages an unbiased tax structure that is
neutral to business processes, business models,
organization structure, product substitutes and
geographical locations
• Helping as a weapon against corruption  
• Thank you