gst in india essay 150 words

Paragraph on GST in English (100, 150, 200, 250 Words)

Goods and Services Tax (GST) is a unified tax system implemented in India since July 1, 2017. It replaces multiple indirect taxes with a single tax structure, aimed at simplifying taxation and fostering economic growth. This tax reform impacts businesses, consumers, and the overall economy.

(Here, we’ve presented paragraphs in 100, 150, 200 & 250 word samples. All the paragraphs will be helpful for students of all classes i.e. Nursery, LKG, UKG & class 1 to class 12).

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Paragraph on GST in 100 Words

GST, or Goods and Services Tax, is a type of tax imposed by the government on the sale of goods and services. It replaced multiple indirect taxes with a single unified tax system. Under GST, goods and services are taxed at various rates depending on their nature. It aims to streamline taxation, reduce tax evasion, and promote economic growth.

GST has different slabs, such as 5%, 12%, 18%, and 28%, with some items exempted or taxed at a lower rate. It affects businesses and consumers alike, influencing pricing and consumption patterns across various sectors of the economy.

GST, short for Goods and Services Tax, is a significant tax reform introduced in India. It amalgamates various indirect taxes into a single tax, aiming to simplify the tax structure and promote economic growth. Implemented in 2017, GST operates on a dual model, with both the central and state governments levying taxes simultaneously.

It categorizes goods and services into different tax slabs ranging from 0% to 28%, with some essential items exempted. GST impacts businesses by streamlining tax procedures and reducing cascading effects, ultimately benefiting consumers through potentially lower prices and improved tax compliance.

GST, known as Goods and Services Tax, revolutionized India’s tax system by unifying numerous indirect taxes. Introduced in 2017, it simplifies taxation by applying a single tax rate to goods and services across the country. The GST framework consists of four tax slabs—5%, 12%, 18%, and 28%—with certain items exempted. It aims to boost economic efficiency, curb tax evasion, and foster a common market.

By eliminating cascading effects and promoting transparency, GST facilitates smoother business operations and enhances competitiveness. Despite initial challenges, GST represents a crucial step towards a more integrated and structured tax regime, benefitting both businesses and consumers in the long run.

GST Paragraph in 150 Words

Goods and Services Tax (GST) stands as a landmark tax reform in India, introduced in 2017 to streamline the complex tax structure prevailing in the country. This unified tax system replaced a multitude of indirect taxes, simplifying compliance and administration for businesses. The primary objective behind implementing GST was to create a common national market, eliminate the cascading effect of taxes, and promote economic growth. By ensuring a seamless flow of goods and services across state borders, GST facilitates trade and enhances efficiency in the economy.

Businesses are the immediate beneficiaries of GST, as it reduces the tax burden and eliminates the need to navigate multiple tax regimes. Moreover, consumers stand to gain from potentially lower prices due to the removal of tax-on-tax and improved tax compliance. Despite initial challenges in implementation, GST represents a significant step towards a more transparent and efficient tax system, fostering long-term economic development and competitiveness.

Paragraph Writing on GST in 200 Words

Goods and Services Tax (GST) is a comprehensive indirect tax levied on the supply of goods and services across India, introduced on July 1, 2017. It replaced a myriad of central and state taxes, aiming to create a unified tax structure and foster economic growth. GST operates on a dual model, with both central and state governments having the authority to levy taxes, resulting in a more streamlined tax system.

The implementation of GST has had a profound impact on the Indian economy. It has simplified tax compliance for businesses by eliminating the cascading effect of taxes and reducing bureaucratic hurdles. This has resulted in improved ease of doing business and enhanced competitiveness both domestically and internationally. GST has also facilitated the formalization of the economy by bringing more businesses into the tax net and promoting transparency.

Several countries have adopted similar GST systems, albeit with variations in rates and structures. Countries like Australia, Canada, and Malaysia have successfully implemented GST, demonstrating its potential as a robust tax reform measure. The adoption of GST by multiple countries reflects its effectiveness in rationalizing taxation, promoting trade, and stimulating economic development on a global scale.

Writing Paragraph on GST in 250 Words

Goods and Services Tax (GST) is a revolutionary tax reform implemented in India on July 1, 2017, to create a unified taxation system. Unlike the previous fragmented tax structure, GST amalgamates various indirect taxes under one umbrella, simplifying compliance for businesses and ensuring a seamless flow of goods and services across state borders. This move towards a more cohesive tax regime has positioned India as a more attractive destination for both domestic and foreign investments.

Countries that have adopted GST or similar VAT-based systems have witnessed several benefits. By streamlining tax procedures, GST promotes transparency and reduces the compliance burden on businesses. Moreover, it encourages the formalization of the economy by bringing previously untaxed sectors into the tax net, thereby broadening the tax base and enhancing revenue collection. Additionally, GST fosters a level playing field for businesses by eliminating the distortionary effects of differential tax rates across states.

The maintenance of the GST system requires continuous monitoring and adaptation to address emerging challenges. This includes regular review of tax slabs and rates to ensure they align with economic objectives while minimizing the burden on consumers. Furthermore, effective implementation of GST necessitates robust technological infrastructure and administrative capacity to handle large volumes of transactions and facilitate compliance.

Positives of GST include its role in curbing tax evasion and promoting ease of doing business, fostering economic growth, and creating a more integrated national market. However, challenges persist, including initial implementation hurdles, compliance complexities, and resistance from certain sectors affected by changes in tax structures.

Additionally, frequent changes in tax rates and compliance requirements can pose challenges for businesses in adapting to the evolving regulatory environment. Despite these challenges, GST represents a significant step towards modernizing India’s tax system and fostering sustainable economic development.

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Introduction

GST is an acronym for goods and services tax. The GST has been introduced as a part of the reforms in India's taxation system to make the process simplified and more transparent. In this essay, we will discuss what GST is, how it is applied, the problem faced by businesses as well as common people due to GST implementation and the possible solutions that the government can take to mitigate those problems.

What is GST?

GST stands for Goods and Services Tax, and it is a tax that is levied on the manufacture, sale, or consumption of goods and services at a national level. The GST replaces all the indirect taxes that are currently being levied in India, such as service tax, value-added tax (VAT), central excise duty, etc.

The GST is levied on every transaction that takes place within India's territory, and it will be the responsibility of the buyer to pay the applicable taxes for any goods or services purchased. GST aims to do away with all indirect taxes like service tax, VAT, etc., making India a single market.

How is GST Applied?

The GST is a destination-based tax, and it will be levied on the value of the goods or services that are consumed within India's territory. The tax will be collected by the person who is responsible for the final consumption of the good or service. For example, if an item is produced in India and is sold to a consumer in another state, the GST will be levied by the state in which the final consumption takes place.

The GST is a multi-stage tax, and it will be levied at every stage of production and distribution of goods and services. The rate of GST at each stage will be based on the value addition that has taken place at that stage.

The GST aims to simplify the taxation system by ensuring a single tax rate across India's territory, thus making sure that goods and services are not taxed multiple times at different rates even if they cross through multiple states before reaching their destination.

Essay on GST

GST was firstly launched in 1954 in France. Currently, 160 countries in the world have implemented GST. As the Canadian model of GST has a federal structure, India has chosen the Canadian model of dual GST. GST stands for goods and service tax which has been applicable in India since July 1st 2017, so July 1st is declared as 'GST day. More specifically, Asam was the first state to get applied with GST. During the passing of the 'GST Bill' in the parliament, 336 votes were with it, and 11 votes were against it. The previous structure of indirect taxes in India was very complex, and quantitative taxes were levied by the central government and state government on goods and services. It has been a long-pending issue to streamline a variety of indirect taxes and implement a 'single taxation' system.

GST requires businesses who have exceeded the prescribed threshold value to register and must keep records of all inputs and outputs. It is exempted from a few products such as alcohols, natural gas, motor spirits and crude petroleum products. GST is simple in a calculation, simply multiplying taxable amount by GST rate. GST rates are covered under 5 tax slabs as 0%, 5%, 12%, 18% and 28%. Most goods fall under the tax slab of 5%, 12% and 18%, while certain services are under 18%. Cement, tobacco lies under the highest tax slab of 28%.

The GST system is categorised into Central GST, also known as CGST, State GST known as SGST and Integrated GST known as IGST. CGST is levied by the central government, SGST by the state government and IGST by the central government on inter-state supplies. In short, while selling within the same state, CGST and SGST need to be paid, and in Inter-state, IGST is.

Due to the implementation of GST, the count of incidences of tax evasion came down in the country, which brings an increase in tax collection for the government. GST has been implemented under Article 279 of the Indian Constitution. The existence of sales tax, service tax, customs duty, excise duty, VAT, Octroi tax etc., vanished. Moreover, A very common procedure for registration of taxpayers, refund of taxes, uniform format of tax returns. With minimum tax or even no tax, the exporters are encouraged to export with the best quality and increase the economy.

GST proved beneficial with more transparency, efficient compliance to central and state manufactures. GST assists in the growth of the Gross Domestic Products (GDP). GDP is expected to increase by 2%. Before the implementation of GST, the prices of the commodity were varying state to state. But, the prices became uniform throughout the country as the GST applied. The implementation of GST has proven a great decision for the country's people. The common man has gained momentum in life due to GST. True life is lived when a few changes occur in it. In addition, GST makes the Indian companies more compatible with the foreign companies and the Indian market more stable than the previous one.

GST is a country-wide tax and was introduced as The Constitution (One Hundred and First Amendment) Act 2017. GST had brought uniformity in the indirect taxation system, which had differently levied by states and centres before now. Different taxes, such as central excise duty, state VAT, etc., have been unified under one single umbrella of GST. Now, businesses do not have to pay taxes as per the state they belong to. Moreover, it has simplified tax calculation as well as returns filing. Under GST, businesses that exceed the prescribed threshold value must register themselves, keep records of input and output, and file their GST returns regularly.

GST is a 'one country-one tax' system. It requires businesses that have exceeded the prescribed threshold value to register and keep records of all inputs and outputs. There are five tax slabs under GST, that is 0%, 5%, 12%, 18% and 28%. Most goods fall under the 5%, 12%, and 18% tax slab, while certain services are subject to 18%. Cement, tobacco lies under the highest tax slab of 28%.

GST is governed by three different acts: The Central Goods and Services Tax Act 2017, Integrated Goods and Services Tax Act 2017, and Union Territory Goods and Services Tax Act 2017. It includes central excise duty that falls under One Hundred and the First Amendment of the Constitution of India.

FAQs on GST Essay

1.What is GST?

GST stands for Goods and Services Tax, a tax that has been applicable in India since July 1st, 2017. It is a single tax that is levied on goods and services, and it replaces the previous structure of indirect taxes in India, which were very complex. GST simplifies the calculation of taxes by multiplying the taxable amount by the GST rate. The tax rates are covered under 5 tax slabs which are 0%, 5%, 12%, 18% and 28%. One of the benefits of GST is that it brings more transparency and efficiency to the compliance of taxes by both central and state manufacturers. Businesses that exceed the prescribed threshold value are required to register and must keep records of all inputs and outputs.

2.How is GST beneficial?

There are many benefits of GST, such as the implementation of a simple taxation system that enables businesses to calculate their taxes easily. It eliminates the indirect taxes, including VAT, CST, Excise Duty and Service Tax. Also, it encourages exports which in turn leads to an increase in GDP. The government's revenue also increases since there is a reduction in tax evasion and the expenses on tax collection and compliance drop. Moreover, GST makes goods and services more affordable as most of them are now under the 18% tax slab. Businesses are no longer required to register multiple times for different indirect taxes, which means that the compliance process becomes easier, and there is less chance of error.

3.What is the difference between Central and State GST?

Central GST is also known as CGST, and State GST is also known as SGST. The main difference between the two is that CGST is levied by the Central Government, and SGST is levied by the State government. IGST is levied by the Central government on inter-state supplies. All three taxes (CGST, SGST and IGST) are collected by the Government of India and then distributed among the states. One should know that the tax rates for CGST, SGST and IGST are different. Different states have different tax slabs. One should be aware of the tax slab for their state in order to pay the correct GST. This will ensure that one is not required to pay more than the amount due.

4.What is the impact of GST on businesses?

The implementation of GST has positively impacted businesses as it has brought more transparency and efficiency to the compliance process. Businesses are now required to register only once and keep track of all input and output transactions. The tax rates are also clearer, making it easier for businesses to calculate their taxes. There is a reduction in tax evasion and the overall expenses on tax collection and compliance. GST has also made Indian businesses more competitive in the global market as it is now aligned with international taxation standards.

5.What are the benefits of GST for consumers?

The main benefit of GST for consumers is that it makes goods and services more affordable as most of them are now under the 18% tax slab. GST has also removed the cascading effect of taxes, which means that there is no tax on tax. This results in a decrease in the prices of goods and services. Consumers are now required to pay tax only on the amount they receive from the business. The benefits of GST for consumers also include a reduction in turn-around time for businesses since there is no need to register multiple times. This means that they receive their goods and services faster. The implementation of GST has had a positive impact on most sectors. The transportation, banking and insurance, telecom and IT sectors have all received benefits from GST.

Paragraph on GST in 100, 150, 200, 250 & 300 Words for Students

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Do you ever wonder why everything you buy has a price tag that seems a little higher than the actual price? That extra amount is often because of something called GST, which stands for Goods and Services Tax. GST is a tax that the government adds to the price of almost everything we buy, from a new backpack to a video game. This might sound unfair at first—why pay more than the sticker price? But GST helps our country in many ways, like building schools and hospitals. In this article, we’ll explore why GST is important, even if it makes things a bit more expensive.

Table of Contents

Paragraph on GST in 100 words

The Goods and Services Tax (GST) is a unified tax system implemented in India on July 1, 2017, replacing many indirect taxes. GST is a value-added tax levied on the manufacture, sale, and consumption of goods and services at the national level. It is applied at every stage of the production process and aims to create a single, coherent market across India. This system makes taxation simpler by having one consolidated tax instead of multiple taxes, which often overlapped under the previous system. By reducing the burden of multiple taxes, GST encourages better compliance and increases government revenues. Additionally, it helps in setting a transparent and corruption-free tax administration. GST’s implementation was a significant step towards simplifying the complex tax structure, making it easier for businesses to comply and for the government to administer.

Paragraph on GST in 150 words

The Goods and Services Tax (GST), introduced in India on July 1, 2017, is a comprehensive, multi-stage, destination-based tax that is levied on every value addition. It has replaced numerous indirect taxes such as VAT, excise duty, and service tax. GST is structured around a dual system comprising CGST (Central GST) and SGST (State GST). This means that the tax collected on every transaction is shared between the central and state governments.

This system aims to bring transparency to the business environment, eliminating the cascading effect of taxes and reducing production costs. Businesses benefit from this as it eases compliance and simplifies the tax structure across state boundaries, promoting a unified market. For consumers, it means lower overall tax burdens on goods and services. GST also features a few tax slabs that range from 0% to 28%, depending on the nature of goods and services. This reform not only boosts the economy by improving the efficiency of tax collection but also aims to make the Indian market more competitive against global standards.

Paragraph on GST in 200 words

Goods and Services Tax, commonly referred to as GST, is a significant tax reform implemented in India on July 1, 2017. GST is a unified, multi-stage, and destination-based tax system that replaced many indirect taxes previously levied in India, such as excise duty, VAT, and service tax. The primary goal of GST is to consolidate multiple indirect tax laws into one comprehensive tax, aiming to create a single national market.

This tax system is categorized into three types: CGST (Central GST), SGST (State GST), and IGST (Integrated GST). CGST and SGST are levied on transactions within a state, shared by the central and state governments. On the other hand, IGST is charged on interstate goods and services and goes to the central government. The implementation of GST has been aimed at reducing the cascading effect of taxes, thereby making goods and services cheaper over time. For businesses, GST has brought about transparency and simplified the tax filing process by moving it online.

It also helps to increase compliance, as GST requires businesses to have clear records of their sales and purchases. For the government, GST provides a more robust mechanism to collect taxes and plug leakages in the system. Understanding GST is crucial as it affects the pricing of almost every product and service in India, influencing both the economy and consumers.

Paragraph on GST in 250 words

The Goods and Services Tax (GST) is a landmark reform in India’s taxation system, introduced on July 1, 2017, which replaced a plethora of indirect taxes like excise duty, VAT, and service tax. As a single, comprehensive tax, GST is levied on the supply of goods and services right from the manufacturer to the consumer. Credits of input taxes paid at each stage will be available in the subsequent stage of value addition, making GST essentially a tax only on value addition at each stage.

The system helps to build a transparent and corruption-free tax administration. GST is administered through a dual system of CGST (Central GST) collected by the central government and SGST (State GST) collected by the state governments for intra-state sales. For inter-state sales, the Integrated GST (IGST) is collected by the central government. This structure ensures that state economies remain robust by enabling them to collect tax on sales made within their territories.

GST has several tax rates ranging from 0% for essential items to a high of 28% for luxury and demerit goods. The implementation of GST has brought about a significant reduction in the overall tax burden on goods, estimated to be reduced by 25%-30%, benefiting both consumers and manufacturers. Moreover, GST has enhanced the competitiveness of Indian goods and services in the international market by eliminating the cascading effect of taxes and promoting a more comprehensive and efficient tax structure.

Paragraph on GST in 300 words

The Goods and Services Tax (GST) is a comprehensive, multi-tiered, destination-based tax that was rolled out across India on July 1, 2017. It is designed to replace the complex mesh of indirect taxes that existed before, such as sales tax, service tax, excise duty, and VAT. GST is hailed as one of the most significant economic reforms in India’s history. The system is divided into CGST for collections by the central government, SGST for collections by state governments for intra-state sales, and IGST for interstate transactions. One of the main advantages of GST is that it eliminates the cascading effect of taxes, where taxes were previously imposed on an already taxed amount, leading to higher costs. By streamlining the taxation process, GST makes doing business easier and encourages greater compliance.

GST also impacts the daily lives of the common man. Most products and services are categorized under four primary GST rates: 5%, 12%, 18%, and 28%. Essential items like basic groceries have been exempted or placed in the lower tax brackets to reduce the burden on the average consumer. Luxury and sin goods, on the other hand, attract higher rates and an additional cess, which is intended to discourage their use.

The GST system has also been credited with increasing transparency and efficiency in the business environment. By standardizing tax rates across the country, it has reduced barriers to interstate commerce, leading to a potential increase in the production and movement of goods. This uniform tax structure has not only simplified the complex tax landscape but has also minimized legal disputes over taxation. Additionally, GST is primarily managed through a digital interface, reducing human error and increasing the ease of doing business. As students, understanding the functionality and implications of GST is essential as it plays a crucial role in shaping India’s economic landscape.

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Essay on GST in English for Children and Students

Table of Contents

GST stands for Goods and Services Tax which is an indirect tax levied on the supply of goods and services. It is levied at every step of the production process i.e. on raw materials purchased by the manufacturer, on products sold to wholesaler by the manufacturer, on products sold to retailer by the whole seller and finally on the sale of product to the consumer. Goods and Services Tax is meant to be refunded to all the parties except the end consumer.

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Long and Short Essay on GST in English

Below we have provided long and short essay on GST of varying word length, to improve your information about the Government’s new tax regime. The essays will be more useful to the school and college students, as well as the aspirants who are preparing for SSC (Staff Selection Commission), UPSC (Union Public Selection Commission) and other competitive exams.

Short Essay on GST and its Importance – Essay 1 (100 Words)

GST stands for the Goods and Services Tax, which is an indirect tax levied by the Government of India, on all the parties of a supply chain of goods and services. GST came into effect from 1 st July 2017, by One Hundred and First Amendment of the Constitution of India.

The most significant aspect of GST is that, it follows a uniform tax rule for specific products, throughout India. The GST is a uniform indirect tax which has replaced all central and state indirect taxes, treating whole of India as a single market. Goods and Services Tax (GST) is also levied on imported goods.

Short Essay on GST in India – Essay 2 (150 Words)

Goods and Services Tax, India is a uniform tax levied on goods and services, treating whole of India as one market. The tax came into effect from 1 st July 2017 and replaced the existing multi level central and state taxes. GST divides goods and services into five tax slabs – 0%, 5%, 12%, 18% and 28%. Though, products like petroleum products, alcohol and electricity, still follow the old tax regime.

The GST Council is the governing body which formulates the tax rates, along with the rules and regulations. It consists of the central finance minister as well as the finance minister of the states. GST replaces many indirect taxes levied by both central and state at various stages, resulting in a reduced tax burden, elimination of cascading of taxes and lower time loss. Before the GST, most of the goods were in the tax range of 26.5 %, but after GST, they have mostly fallen under the tax range of 18%.

Essay on Objectives of GST – Essay 3 (200 Words)

GST is an abbreviation for Goods and Services Tax, India. It is a uniform indirect tax, replacing various indirect taxes at different stages, levied before by both central and state governments. GST treats India as one big market following a uniform tax regime throughout the country, irrespective of states.

Though GST is charged by all the registered dealers in a supply chain (raw materials supplier, manufacturer, wholesaler, retailer, consumer), from the next customer, the ultimate burden of the tax is on the end customer i.e. the consumer. All the other dealers registered with GST act as intermediaries collecting GST from the consumer and passing it onto the government, getting tax credit in return. This tax credit is called “Input Tax Credit” and is placed against the GST charged by the dealer to the customer, to which he/she is supplying goods.

Any registered dealer is also eligible for tax refund if the input tax credit exceeds the output tax credit, as according to the provisions provided by law in this regard. Moreover, no GST credit could be claimed for the purchase of exempted goods. The GST is not levied on all types of vegetables, organic manure, contraceptives, printed books, stamp papers, agricultural equipments etc.

Essay on Use of GST in India – Essay 4 (250 Words)

Introduction

Goods and Services Tax in India, is a tax levied uniformly throughout India on the supply of goods and services as well as on the import of goods from foreign destinations. GST has divided particular goods and services under uniform tax slots, which initially varied from state to state. GST is an indirect Tax i.e. the dealers registered with GST act as intermediaries, collecting the tax from the end customer, which is the consumer, who ultimately bears the final burden of tax.

How GST Works

The basic mechanism of taxation under GST is that it is levied at every stage of the supply process. It is subsequently paid by the manufacturer, wholesaler, retailer and consumer. Though, the registered dealers (manufacturers, wholesalers and retailers) charge GST, they don’t keep the amount, rather pay it back to the government with a tax invoice and claim credit for the tax thus collected.

This leaves the end user i.e. the customer as the one who bears the final burden of tax. The end customer has to pay prescribed GST on the product purchased or on the services availed, without any provision of claiming the return or credit.

An uniform Goods and Services Tax replaces other central and state indirect taxes like – VAT (Value Added Tax), CENVAT (Central Value Added Tax), excise tax, customs tax, state excise tax etc. In a way, the GST has integrated the central and state taxation system into one uniform tax regime. In a layman’s term, the manufactures and suppliers of a particular product, now have to pay a uniform tax throughout India.

Essay on Meaning and Types of GST – Essay 5 (300 Words)

GST stands for Goods and Services Tax, India. It is a comprehensive tax levied by the government on the supply of goods and services. It is also an indirect tax, replacing other central and state levied indirect taxes. GST has brought the whole India under one tax regime, saving time and resulting in low tax burden.

Types of GST

There are basically four types of Goods and Services Taxes, as described below-

1) Central Goods and Services Tax (CGST)

CGST is the GST levied by the Central Government of India on the transaction of goods and services with a state or Union Territory. CGST replaces other central taxes like – Central Excise Duty, Central Sales Tax, Custom Duty and SAD (Special Additional Duty) Tax.

2) State Goods and Services Tax (SGST)

SGST is the GST levied by state on transactions of goods and services within the state. It is one of the two taxes levied within a state, other being the CGST. State GST replaces the state levied taxes – Value Added Tax, Luxury Tax, Entry Tax, Entertainment Tax etc. The revenue thus collected under the SGST is solely claimed by the respective state government.

3) Integrated Goods and Services Tax (IGST)

While CGST and SGST are the GST levied on intrastate (within the state) transactions of goods and services; IGST stands for the GST levied on the interstate (between two states) transaction of goods and services. However, IGST is collected by the central government and reimbursed later to the respective state.

4) Union Territories Goods and Services Tax (UTGST)

UTGST is the GST levied on the transaction of goods and services in these five Union Territories of India – Andaman and Nicobar Islands, Daman and Diu, Dadra and Nagar Haveli, Chandigarh and Lakshadweep. Total GST levied in a Union Territory is the sum of CGST and UTGST. State GST isn’t applicable to UTs, as it would require a legislature. Union Territories of Delhi and Pondicherry rather have SGST, because they have their own legislature.

The main reason for GST is to bring whole India under one uniform tax regime. It has reduced the unnecessary tax burden of different state and central taxes, on the dealers and has made the goods cheaper for both the stakeholders and the consumer.

Essay on GST (History and Significance) – Essay 6 (400 words)

Goods and Services Tax, India abbreviated as GST is a tax based on the consumption of goods or services throughout India. GST is an indirect tax which has replaced the previous indirect taxes. Direct taxes like – income tax, corporate tax etc, are not affected by the GST.

Brief History of GST

Goods and Services Tax (GST) was proposed in 1999, in the government of the then Prime Minister of India, Atal Bihar Vajpayee. Further, a committee was setup by Prime Minister Vajpayee under the then Finance Minister of West Bengal, Asim Dasgupta to formulate a GST model. Since then, the GST could not be implemented, until recently on 1 st July 2017 by the NDA (National Democratic Alliance) government led by the BJP (Bhartiya Janata Party).

Significance/Importance of GST in India

Goods and Services Tax is an essential indirect tax reform in India. Before GST, India had many indirect taxes levied respectively by both central and state governments, resulting in high amount of taxes also requiring high amount of resources for their collection and maintaining records.

Integration of both central and state taxes into one, will forego many adversities of previous tax system i.e. multiple taxations, cascading, loss of time and resources etc. Besides, GST considers whole of India as one unified market, consequently promoting foreign investment.

By eliminating the cascading of tax at various levels, GST makes the goods cheaper for the registered dealers as well as the end consumer consequently leading to economic growth of the nation. India is a developing nation, still struggling with the issue of unemployment. GST is expected to create new employment opportunities in the field of taxation and accountancy along with vacancies in the manufacturing sector.

A centralized GST has resulted in elimination of various check posts during the interstate transportation of goods. The travel time of interstate goods transport vehicles, have reduced considerably by 20% due to the absence check posts. Also, the multi party involvement in GST will improve the compliance level.

GST will lead to a more transparent and corruption free taxation system. The GST is formulated in such a way, so that it benefits both the businesses and the consumers. India needed a better tax reform on indirect tax like the Goods and Services Tax. GST places India at a better place to negotiate in international market. Also, by bringing SMEs (Small and Medium Enterprises) and other organized sector, under its gambit, GST leads to a more stable Indian industrial sector and an improved economy.

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Essay on GST for Students and Children

500+ words essay on gst.

Goods and Services Tax (GST) refers to an indirect tax. The implementation of this tax is in India. The collection of this tax takes place from the point of consumption. This is in contrast to collection from the point of origin like previous taxes. Furthermore, this tax’s imposition is at every step in the production process. The refund is for all the parties in the various stages of production. Also, GST includes almost all indirect taxes.

Explanation of GST

First of all, Goods and Services Tax (GST) is a single tax system. The imposition of this tax takes place jointly by the center and the state. Furthermore, the imposition happens with the recommendation of a federal council.

In GST, the goods and services are divided into five different tax slabs. This is for the purpose of the tax collection. Above all, the tax slabs are – 0%, 5%, 12%, 18% and 28%. Also, petroleum products, alcoholic drinks, and electricity do not come under GST. Rough precious and semi-precious stones carry a special rate of 0.25%. Gold also carries a special rate of 3%.

GST certainly subsumed several taxes and levies. These include central excise duty, services tax, and additional customs duty. Furthermore, state-level VAT , surcharges, and Octroi also come under GST. The GST regime has done away with levies. Also, these levies were applicable to inter-state transportation of goods. Most noteworthy, the application of GST is on all transactions. These transactions are sale, purchase, transfer, lease, and import.

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Benefits of GST

First of all, the cascading tax effect refers to a tax on tax. Most noteworthy, GST eliminates the cascading effects of Tax. This is because GST is a comprehensive indirect tax. It certainly brings almost all indirect taxation under one umbrella.

Another notable advantage of GST is the increase in the threshold for registration. Earlier, a VAT was applied if the turnover was more than Rs 5 lakh. This VAT’s application was upon a business. Furthermore, there was no service tax when turnover was less than Rs 10 lakh. In contrast, under GST this threshold is Rs 20 lakh. Hence, this means an exemption for many small traders and service providers.

Small businesses can certainly benefit significantly under GST. Furthermore, these small businesses have a turnover of Rs 20 to 75 lakh. The benefit of these small businesses takes place due to the composition scheme. Under GST, there is an option for small businesses to lower taxes. They can do so by utilizing the composition scheme.

The entire process of GST is available online. Most noteworthy, it is an easy and simple online process. Therefore, it is really beneficial for start-up businesses. This is because they don’t have to struggle to get different registrations. In conclusion, GST has been a revolutionary tax system for India. Most noteworthy, many experts hail it as one of the biggest tax reforms. GST certainly is beneficial for the entire population of India.

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Essay on GST for Students | Goods and Service Tax Essay, Benefits and Laws of GST

February 13, 2024 by Prasanna

Essay on GST: GST or Goods and Services Tax, India is a tax based on the usage of goods or services across India. GST is an indirect tax replacing the previous indirect taxes imposed on the goods and services. Direct taxes such as income tax, corporate tax, etc., are not influenced by the GST. Everything you need to know about GST essay writing, Essay on GST in English, Essay GST.

Essay on Goods and Services Tax (GST)

Goods and Services Tax was introduced in 1999, by the government of India when Atal Bihar Vajpayee was the Prime Minister of India. Moreover, a board was set up by Prime Minister under the Finance Minister of West Bengal, Asim Dasgupta to express a GST model. Since then, the GST could not be executed, until lately by the NDA (National Democratic Alliance) government on 1st July 2017 led by the Bhartiya Janata Party or in short BJP.

Goods and Services Tax is a necessary indirect tax improvement in India. Ere GST, India possessed many indirect taxes imposed respectively by both central and state governments. It resulted in a high volume of taxes, also requiring a high amount of supplies for their stock and managing records.

A combination of both state and central taxes into one will forego many difficulties of the former tax system such as recurring taxations, cascading of taxes, loss of time and sources, etc. Furthermore, GST counts the whole of India as one combined market, consequently encouraging foreign investment. Read an essay about GST.

Essay on GST With Headings

By reducing the cascading of tax at numerous levels, GST offers the goods more affordable for the listed dealers as well as the end customer and hence leading to the financial growth of the country. India is a developing country, still coping with the matter of unemployment. GST is demanded to create new job opportunities in the area of taxation and accountancy, along with openings in the industrial sector.

A centralized GST has emerged in the exclusion of different check posts through the interterritorial transport of goods. The travel time of regional goods vehicles has decreased considerably by 20% due to the lack of check posts. Also, the involvement of multiple parties in GST will increase the assent level.

GST is a big step to lead India into a more transparent and corruption-free taxation system. The GST rules are formed such that it is advantageous for both the sellers and the buyers. India required a better tax improvement on indirect tax like the Goods and Services Tax. GST puts India to a better place to accommodate in the international market. Also, by inducing Small and Medium Enterprises (SMEs) and another organized sector, under it, GST heads to a more enduring Indian industrial area and an enriched economy.

Laws of GST

GST includes a total of 5 laws which are:

Central GST Law
State GST Law
Union Territory GST Law
Integrated GST Law
The Goods and Services (Compensation To State) Law

Here, Central GST Law administers with the combination of all taxes on goods and services, their compilation and organizations. Similarly, State GST Law governs at the state level (29 states and 2 Union Territory: Delhi and Puducherry which have their legislative assembly ). Union Territory GST consolidates the stipulations of CGST and practices it to the outstanding Union territories and Indian territories which are away from the regional waters.

Integrated GST administers with import and business between 2 states or union territory. Any disagreement arising under IGST will be resolved by the Centre or by any state authorized by the Centre. Lastly, The Goods and Services Law administers with managing a payment process for paying the states which incited a loss for the first five years of implementation of GST.

GST is a progressive tax, it will have various tax rate for many goods because an alike tax rate on all goods, for example, a toothbrush and a Mercedes car is not possible and not supported as the relevant customer group is different for distinct products.

Benefits of GST

The primary benefit of GST is that it will decrease the likelihood of tax manipulation by the officials as the customer has to pay only one tax collectively rather than multiple taxes levied in the previous tax system.
This taxation method is more transparent. It will continuously abolish expansion and various requirements like the tax-return will serve the state also.
Customers will be benefitted the most since they are considered to be the King.

Disadvantages of GST

Many thoughts have come stating GST is an old taxation law fulfilled with a new name and some new requirements. GST is divided between CGST and SGST. It may direct to conflict between state and Centre.
Furthermore, many products will be imposed higher as the tax will be charged on some commodities on which there were no taxes before. Some of the product’s tax percentages would be raised to either 12% or 18% or 28% if they were previously charged with 10 %, 16% or 26% tax respectively.
GST is a very long and cumbersome method that takes time and manpower.
GST incorporates 29 states 2 Union Territories and The Centre. So there could be many views which could undesirably delay the judgments and thus the main cause behind the GST will disappear.

GST Essay Conclusion

Small companies can undoubtedly profit significantly beneath GST. Moreover, these small industries have a turnover of Rs 25 to 70 lakh. The advantage of these small trading takes place because of the planning scheme. Below GST, there is a choice for such business to lower taxes. It can be done by using the planning scheme.

The whole process of GST is accessible online. The unique thing is- it is an easy and straightforward online method. Hence, it is advantageous for start-ups, as they don’t have to strive to get multiple registrations.

In the end, GST has been an innovative tax system for India. Many specialists praise it as one of the most significant tax reforms. GST surely is profitable for the complete population of India.

FAQ’s on Essay on GST

Question 1. What is GST?

Answer: GST or Goods and Service Tax is an indirect or consumption-based tax imposed by the Indian Government on all the goods and services parties of a supply chain. GST is an Indirect Tax which has succeeded in 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 complete, multi-stage, destination-based tax that is levied on every value addition.

Question 2. What are the types of GST?

Answer: There are four types of GSTs:

Central Goods & Services Taxes (CGST)
State Goods & Services Taxes (SGST)
Integrated Goods & Services Taxes (IGST)
Union Territory Goods & Services Taxes (UTGST)

Question 3. Why GST is Important?

Answer: GST strives to replace all indirect taxes levied on goods and services by the Central and State governments of India. GST would subsume with a sole comprehensive tax, reducing the cascading impact of taxes on the production and circulation prices of goods and services.

Question 4. What are the advantages of GST?

Answer: GST has largely eliminated the Cascading impact on the sale of goods and services. Elimination of cascading of tax has impacted the cost of goods. Since the GST administration eliminates the tax on tax, the cost of goods reduces. GST is also more technologically inspired. All actions like registration, tax return, applying for refund and acknowledgment to notice requires to be done online on the GST Portal this stimulates the processes.

Question 5. What was the list of Indirect Tax before the GST was launched?

Central Excise Duty
Duties of Excise
Additional Duties of Excise
Additional Duties of Customs
Special Additional Duty of Customs
Central Sales Tax
Purchase Tax
Entertainment Tax
Taxes on advertisements
Taxes on lotteries, betting, and gambling

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Essay on GST

Students are often asked to write an essay on GST in their schools and colleges. And if you’re also looking for the same, we have created 100-word, 250-word, and 500-word essays on the topic.

Let’s take a look…

100 Words Essay on GST

Introduction to gst.

GST, or Goods and Services Tax, is a value-added tax levied on most goods and services sold for domestic consumption. It is a single tax that replaces multiple taxes imposed by the state and central governments.

Benefits of GST

GST simplifies taxation by unifying different taxes, reducing the cascading effect of tax on tax. It encourages transparency, aids in the growth of the economy, and is beneficial for both businesses and consumers.

Challenges of GST

While GST has many advantages, it also faces challenges like technical glitches in GSTN, increased compliance burden, and initial resistance from small businesses.

Also check:

250 Words Essay on GST

Introduction.

The Goods and Services Tax (GST) is a comprehensive, multi-stage, destination-based tax system introduced in India on July 1, 2017. It has replaced several indirect taxes, fostering a uniform tax structure and enhancing ease of doing business.

Implications of GST

GST has brought about significant changes in the economic landscape. By eliminating the cascading effect of taxes, it has reduced the overall tax burden on consumers. It has also promoted competitiveness by establishing a level playing field for businesses.

Challenges and Opportunities

Despite its benefits, GST implementation has faced challenges. These include technical glitches, a complex structure, and initial resistance from businesses. However, the government has been proactive in resolving these issues, showcasing adaptability.

On the brighter side, GST has opened up opportunities for businesses. It has simplified the tax structure, making compliance easier. Additionally, the input tax credit mechanism has incentivized businesses to be part of the formal economy, driving economic growth.

Future Outlook

Looking forward, GST is expected to play a pivotal role in India’s economic narrative. With the government’s continuous efforts to simplify GST and make it more business-friendly, it is anticipated to stimulate economic growth and enhance India’s global competitiveness.

In conclusion, while GST implementation has had its fair share of teething troubles, its long-term benefits are undeniable. It is a progressive tax reform that has the potential to transform India’s economic trajectory.

500 Words Essay on GST

GST, or Goods and Services Tax, is a comprehensive, multi-stage, destination-based tax implemented in India on July 1, 2017. This tax system replaced many indirect taxes previously levied by the Indian government, with the aim of streamlining the taxation process and reducing the prevalence of double taxation.

The Mechanism of GST

GST operates on a multi-stage system, meaning it is applied at each step of the production process. However, it is refunded to all parties involved in the various stages of production other than the final consumer. This destination-based aspect ensures that the tax is collected from point of consumption rather than point of origin, thereby ensuring a more equitable distribution of the tax burden.

Types of GST

There are four types of GST in India: Central GST (CGST), State GST (SGST), Integrated GST (IGST), and Union Territory GST (UTGST). CGST and SGST are levied on intra-state transactions, while IGST is levied on inter-state goods and services. UTGST, meanwhile, is levied on transactions in the Union Territories.

The Impact of GST

The implementation of GST has had far-reaching implications. It has simplified the tax structure by merging a multitude of taxes into a single system. This has reduced the complexity of doing business, thereby promoting entrepreneurial activity and economic growth.

Challenges and Criticisms of GST

Despite its advantages, GST has also faced criticism. The main challenge lies in its implementation, as it requires a robust IT infrastructure and widespread internet access, which are lacking in some parts of India. Additionally, the multi-tiered tax rate structure has been criticized for being complex and burdensome for small businesses.

Moreover, some critics argue that GST has increased the cost of certain goods and services, impacting the common man. The tax slabs are also a point of contention, as luxury and essential goods are taxed at the same rate in some cases.

If you’re looking for more, here are essays on other interesting topics:

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GST Essay in English for Students

November 12, 2021 by Sandeep

Essay on GST: Implementation of GST is a big step for making the Indian economy better, stronger, and more transparent. GST made it easier for companies to record tax payments and schedule tax payments. Below we have provided GST Essay in English, suitable for classes 6, 7, 8, 9 & 10. This detailed essay on GST of 200-250 words is greatly helpful for all school students to perform well in essay competitions.

Essay on GST

GST is the abbreviation of Goods and Services Tax. GST is a kind of tax that was implemented in India on 1 July 2017. This tax is considered a major reform of the Indian tax system after independence. Since its implementation, GST has been a controversial tax in the context of the Indian tax system. The government collects tax from the country’s citizens in two forms; Direct Tax and Indirect Tax. Direct taxes are based on citizens’ income, and indirect tax is levied based on purchasing a product or service.

Income tax is a direct tax, whereas GST is an indirect tax that brought many taxes under the same roof. To understand the features and concept of GST, we have to take a quick look at the previous tax system. In the earlier tax system, the taxes used to be charged on every stage of goods. From the manufacturing of a product to its sales, a tax has to be paid.

These taxes used to be in VAT, excise, CST, but GST has replaced all different types of taxes. Earlier, the rate of taxes can be varied in different states, and there were two types of taxes; central taxes and state taxes. Now with GST, the rate of taxes is the same in all the country’s states, and taxes have been imposed jointly by the state and central government.

Benefits of GST

The earlier tax system in India was not favorable for small business units. Different types of taxes were present at that time, and on a product, different taxes were imposed. The motive behind the implementation of GST was “One Nation One Tax.” GST has its benefits and disadvantages.

The Indian economy is developing at lightning speed, and it has to compete with other more developed economies. Countries like Sweden, Denmark, Germany, Switzerland, and Japan have already implemented the GST. This tax helped the economy of the countries to grow. GST works like a common window for tax collection. Here are the other benefits of GST that will help the Indian economy in the long run.

Ease of Business – One Country One Tax made it easier for the business to set up their project in any state of the country. Earlier, the taxes on any projects used to vary from one state to another. But now, tax slabs are the same for one item in all the states of the country.

Easy Tax Filling – Different types of taxes like sales tax, Vat, services tax, etc., have been covered under GST, so tax filing has become much easier. The entire process of GST, from registration to filing returns, is available online.

Elimination of Different Taxes – Before GST, different types of taxes were used to apply to one product. Taxes like excise, octroi, sales tax, CENVAT, Service tax, turnover tax, etc., have different rates, but GST has included all of them in it.

Regulated Under-organised sector – Before the implementation of GST, many big industries like construction and textile were unorganised. But after the implementation of GST, companies associated with these industries have to complete all the compliance online then have to stick to regulations.

Defined tax for E-commerce – Before the implementation of GST, the business for E-commerce sites was difficult. For Up, they will have to apply VAT, and for other states like Rajasthan, they will have to remove it. So it was confusing for them. But GST made it easy as it’s one tax for all the states.

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Essay on GST in English

Updated on
Mar 2, 2024

GST, Goods and Services Tax, is an indirect tax levied on goods and services produced, manufactured and sold in India. By indirect, it means the government collects it from the sellers or businesses and not from consumers. Consumers pay GST on the products and services bought from the seller. On this page, we will discuss some sample essay on GST, its meaning, benefits and other dimensions.

Table of Contents

1 Essay on GST in 100 words
2.1 How GST Works?
3.1 Types of GST
3.2 Benefits of GST
3.3 Challenges of GST
3.4 Conclusion

Essay on GST in 100 words

‘GST, Goods and Services Tax, is a tax system in India introduced on July 1, 2017, to simplify the tax structure. Before GST, there were multiple taxes at both national and state levels. The main idea was to make taxation more straightforward, encourage business, and eliminate redundant taxes.’

‘GST is divided into five types of tax rates: 0%, 5%, 12%, 18%, and 28%. Luxury goods like SUVs and sedan cars, houses, casinos, etc. have the highest GST rate; 28%. The tax is applied based on where the goods or services are consumed, making it a destination-based tax. Overall, GST has made the tax process transparent and more efficient in India.’

Essay on GST in 200 words

”GST stands for ‘Goods and Services Tax’. It is a uniform indirect tax levied on the ‘supply’ of goods or services and not on the manufacture of goods on the sale of goods or provision of services. India borrowed its GST model from the Canadian Dual GST model.’

Under GST, goods and services are divided into five tax slabs: 0%, 5%, 12%, 18% and 28%. Products and services like dry and fresh vegetables, unroasted coffee beans and green tea leaves, raw silk, khadi fibre, etc. are all exempted from GST. Products like petroleum, electricity and alcohol drinks follow the old taxation system, with separate central and state taxes.’

How GST Works?

‘GST is based on the principle of destination-based consumption taxation, rather than the present principle of origin-based taxation. Under GST, all the suppliers, manufacturers, wholesalers and retailers have to register their good and services. Wholesalers and retailers are the intermediaries through which the government collect taxes. The government collects indirect tax from customers, who buy products and services from retailers and wholesalers. The ultimate burden of GST falls on customers.

‘GST has made the taxation process more transparent and efficient than ever. Previous taxes, like services tax, central excise tax, state-level VAT, and additional customs duty have fallen under GST.’

‘GST certainly subsumed several taxes and levies. These include central excise duty, services tax, and additional customs duty. Furthermore, state-level VAT , surcharges, and Octroi also come under GST. The GST system has eliminated previous levies, particularly those related to inter-state transportation of goods. Notably, GST is now applicable to a wide range of transactions, including sales, purchases, transfers, leases, and imports.’

Essay on GST in 600 words

The full form of GST is “Goods and Services Tax”. GST is a uniform tax that is levied on the supply of goods and services by the government of India. GST, as an indirect tax, has replaced all the other state as well as central indirect taxes. It has brought the whole of India under a single tax regime, hence resulting in saving time and a low burden of tax.

Types of GST

GST has been divided into four types. These types are:

C-GST (Cental-GST)
It is levied on the transaction of goods and services by the Central Government of India with a state of Union Territory. CGST has replaced central taxes such as Central Excise Duty, Customs Duty, Central Sales tax, and SAD i.e. Special Additional Duty Tax.
S-GST (State- GST)
This GST is levied by the State Government on the transactions of goods and services within the state. It is the tax that is levied within a state, other than CGST. the taxes that SGTS replaces include:- Luxury Tax, Entry Tax, Value Added Tax, Entertainment Tax, etc.
I-GST (Integrated Goods and Services Tax)
The IGST is levied on the transaction of the goods and services that are interstate i.e. between two or more states, unlike CGST and SGTS which are levied in an intrastate manner. IGST is collected by the central government and then reimbursed later by the respective state.
UT-GST (Union Territories – GST)
This GST is imposed on the transaction of goods and services in the ahead mentioned 5 union territories of Idia:- Daman and Diu, Dadar and Nagar Haveli, Andaman and Nicobar Islands, Chandigarh, and Lakshadweep. The GST on the union territories is the total of the UTGST and the CGST. SGST does not apply to UTs as it would involve the Legislature. UTs of Delhi and Pondicherry rather have SGST as they have they have their own Legislature.

Benefits of GST

GST has eliminated the cascading tax effect; tax on tax.

GST will help to establish a Unified Common Market, which will provide a significant boost to foreign investment and the “Make in India” initiative.
GST will boost export and manufacturing activity. There will be employment opportunities, which will lead to substantive economic growth and poverty eradication.
It has made the tax regime more simpler.
Businesses can easily flourish under tax guidelines.
Elimination of double taxation on various sectors.
Efficient neutralisation of taxes, especially on exports.
It will help in making prices transparent as the
The transparency in the seamless flow of input tax credit between manufacturers, retailers, and service providers is anticipated to result in a clear and transparent final price for goods.
Reduction in the prices of services and products in the long run.

Challenges of GST

Although GST has several advantages to the government, manufacturers, wholesalers, retailers and ultimately consumers, there are certain challenges also.

CGST and SGST input credits cannot be cross-utilised.
Manufacturing states experience substantial revenue loss on a larger scale.
A higher tax rate is imposed to compensate for the revenue previously collected from various taxes, resulting in a high Revenue Neutral Rate.
There is a decrease in the fiscal autonomy of the states.
Banks and insurance companies express concerns about the necessity for multiple registrations under GST.
An additional cess is levied.
The ability of State tax authorities, accustomed to taxing goods rather than services, to handle the latter is uncertain.
The effectiveness of GST relies on political consensus, technological integration, and the capability of tax officials to adjust to new requirements.

Also Read: What is the Full Form of IGST?

The main purpose of GST is to treat India as one big market and imply one uniform tax regime. GST has had many effects such as reducing the unnecessary tax burden of different states and central taxes, making goods cheaper for both, the stakeholders as well as the consumers.

Ans: The full form of GST is ‘Goods and Service Tax’ and it is an indirect tax that is levied on the goods and services by the government of India. GST came into effect on the 1st of July, 2017 by the One Hundred and First Amendment of the Indian Constitution. One of the most important aspects of GST is that it follows a tax rule that is unique and specific to products all over India. Hence, we can say that it is a uniform indirect text that has replaced all the central as well as state indirect taxes. Because of GST, whole of the India is being treated as a single market.GST is also implied on imported goods.

Ans: GST is a short form that stands for ‘Goods and Services Tax’. -It is a uniform indirect tax that has replaced all the indirect taxes be it state taxes or central taxes. -The best aspect of GST is that it treats India as one big market hence following a uniform tax regime throughout the country, irrespective of the states. -All the registered dealers (suppliers, manufacturers, retailers, wholesalers, etc.) in the supply chain charge GST. -The dealers act as intermediaries in this and thus collect GST from the consumer which is then passed on to the government.

Ans: The full form of GST is “Goods and Services Tax”. GST is a uniform tax that is levied on the supply of goods and services by the government of India. GST, as an indirect tax, has replaced all the other state as well as central indirect taxes. It has brought the whole of India under a single tax regime, hence resulting in saving time and a low burden of tax. Types of GST:- There are mainly 4 different types of GST that are mentioned below:- -C-GST (Cental-GST) -S-GST (State- GST) -I-GST (Integrated Goods and Services Tax) -UT-GST (Union Territories – GST)

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Essay on GST in English (जीएसटी पर निबंध)

Essay on gst.

Let’s start the essay on gst…

Outline of the Essay

Introduction- GST
The key feature
Objective and conclusion

Introduction- GST

GST stands for goods and services tax which could be also referred to as an indirect tax, levied on the supply of goods and services. It is applied at every step of the production process. It is the government of India who levies this tax. Well, GST came into effect from 1st July 2017 by one hundred and first amendment of the constitution of India.

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Key Feature

The key feature of this system of tax is it follows a uniform tax rule for specific products, throughout India. It has replaced all the other forms of indirect state or central taxes, enhancing the uniformity of the market.

The GST council of India is a governing body, it formulates the tax rates, and works with other similar regulations. It consists of a central finance minister as well as the finance minister of the states.

Before GST, the goods were charged with 26.5% of tax (including all kinds of taxes), now it has gotten down to almost 18%.

The tax that is systematized by the GST is that it is paid by everyone at the ends of procedures that are into the manufacturing of a product. It is hence subsequently paid by manufacturers, wholesalers, retailers, etc. It is, in the end, the consumer that has to pay the burden of all taxes. He /she bears the final burden of the taxes.

Objective and Conclusion

The main objective behind bringing GST- Goods and Services Tax into the system was to make the whole Indian market a uniform one. It has reduced the unnecessary tax burdens of different state and central taxes, and similarly, it is likely to appear as a more transparent system.

Also by bringing small and medium enterprises, and other forms of organized sectors, GST leads to a more stable Indian industrial sector and might improve the economy.

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Goods and Services Tax (GST): Everything You Need to Know Including Issues Unresolved

Last updated on October 15, 2023 by ClearIAS Team

Table of Contents

What is GST?

It is a destination-based taxation system.
It has been established by the 101 st Constitutional Amendment Act .
It is an indirect tax for the whole country on the lines of “ One Nation One Tax ” to make India a unified market.
It is a single tax on the supply of Goods and Services in its entire product cycle or life cycle i.e. from manufacturer to the consumer.
It is calculated only in the “ Value addition ” at any stage of goods or services.
The final consumer will pay only his part of the tax and not the entire supply chain which was the case earlier.
There is a provision of the GST Council to decide upon any matter related to GST whose chairman in the finance minister of India.

What taxes at the centre and state level are incorporated into the GST?

At the state level.

State Value Added Tax/Sales Tax
Entertainment Tax (Other than the tax levied by the local bodies)
Octroi and Entry Tax
Purchase Tax
Taxes on lottery, betting, and gambling

At the Central level

Central Excise Duty
Additional Excise Duty
Service Tax
Additional Customs Duty (Countervailing Duty)
Special Additional Duty of Customs

Timeline of GST

1986: VishwanathPratap Singh, Finance Minister in Rajiv Gandhi’s government, proposed in the Budget a major overhaul of the excise taxation structure. This was similar to GST in a theoretical sense.
2000 : Initiating discussions on GST, Vajpayee government appoints an Empowered Committee headed by the then finance minister of West Bengal Asim Gupta.
2004 : Vijay Kelkar, then advisor to the Finance Ministry, recommends GST to replace the existing tax regime.
Feb 28, 2006 : GST appears in the Budget speech for the first time . Finance Minister Chidambaram sets an ambitious task of implementing GST by April 1, 2010.
Feb 28, 2007 : Chidambaram said in his Budget speech that the Empowered Committee of finance ministers will prepare a road map for GST.
April 30, 2008 : The Empowered Committee submits a report titled ‘A Model and Roadmap Goods and Services Tax (GST) in India’ to the government.
Nov 10, 2009 : Empowered Committee submits a discussion paper in the public domain on GST welcoming debate.
Feb 2010 : Government launches project for computerisation of commercial taxes. Finance Minister Pranab Mukherjee defers GST to April 1, 2011.
March 22, 2011 : Constitution Amendment Bill (115th) to GST introduced in the LokSabha
March 29, 2011 : Bill referred to Standing Committee on Finance.
Nov 2012 : Finance minister and state ministers decide to resolve all issues by Dec 31, 2012.
Feb 2013 : Declaring the government’s resolve to introduce GST, the finance minister makes provisions for compensation to states in the Budget.
Aug 2013 : The standing committee submits a report to Parliament suggesting improvements. But the bill lapsed as the 15th LokSabha was dissolved.
Dec 18, 2014: Cabinet approval for the Constitution Amendment Bill (122nd) to GST.
Dec 19, 2014 : The Amendment Bill (122nd) in the LokSabha
May 6, 2015: The Amendment Bill (122nd) passed by the LokSabha.
May 12, 2015 : The Amendment Bill presented in the RajyaSabha
May 14, 2015 : The Bill forwarded to a joint committee of RajyaSabha and LokSabha
Aug 2015 : Government fails to win the support of the Opposition to pass the bill in the RajyaSabha where it lacks sufficient numbers.
Aug 3, 2016: RajyaSabha passes the Constitution Amendment Bill by a two-thirds majority. Note: GST constitutional amendment bill needs to pass by at least 50% of state legislatures to be implemented. Assam is 1 st State to pass the GST bill.
1 July 2017 : GST to be applicable across India.

Benefits of GST

For Central and State Governments

Simple and Easy to administer: Because multiple indirect taxes at the central and state levels are being replaced by a single tax “GST”. Moreover, backed with a robust end-to-end IT system, it would be easier to administer.
Better control on leakage: Because of better tax compliance, reduction of rent-seeking, transparency in taxation due to IT use, and an inbuilt mechanism in the design of GST would incentivize tax compliance by traders.
Higher revenue efficiency: Since the cost of the collection will decrease along with an increase in the ease of compliance, it will lead to higher tax revenue.

For the Consumer

The single and transparent tax will provide a lowering of inflation.
Relief in overall tax burden.
Tax democracy that is luxury items will be taxed more and basic goods will be tax-free.

For the Business Class

The ease of doing business will increase due to easy tax compliance.
Uniformity of tax rate and structure, therefore, better future business decision making and investments by the corporates.
Removal of cascading effects of taxes.
Reduction in transactional costs will lead to improved competitiveness.
Gain to the manufacturers and exporters .
It is expected to raise the country’s GDP by 2% points.

Note: We have covered the 10 major benefits of Goods and Service Tax in a separate article.

GST Council

It is the 1 st Federal Institution of India, as per the Finance minister.
It will approve all decisions related to taxation in the country.
It consists of the Centre, 29 states, Delhi and Puducherry.
Centre has 1/3 rd of voting rights and states have 2/3 rd of voting rights.
Decisions are taken after a majority in the council.

Supporting Laws to implement GST

For the implementation of GST, apart from the Constitution Amendment Act, some other statutes are also necessary. Recently 5 supporting laws to the GST were recommended by the council. 4 of the bills should be passed by the parliament, while the 5th one should be passed by respective state legislatures. The details are given below.

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The Central Goods and Services Tax Bill 2017 (The CGST Bill).
The Integrated Goods and Services Tax Bill 2017 (The IGST Bill).
The Union Territory Goods and Services Tax Bill 2017 (The UTGST Bill).
The Goods and Services Tax (Compensation to the States) Bill 2017 (The Compensation Bill).
And a state GST will be passed by the respective state legislative assemblies.
Tax slabs are decided as 0%, 5%, 12%, 18%, and 28% along with categories of exempted and zero-rated goods for different types of goods and services.
Further, a cess would be levied on certain goods such as luxury cars, aerated drinks, pan masala and tobacco products, over and above the rate of 28% for payment of compensation to the States.
However, which goods and services fall into which bracket is still an enormous task to be completed by the GST Council.
The highest tax slab is pegged at 40% .

Also read: Transparency and Accountability: All you need to know

What is the Principle of GST?

The Centre will levy and collect the Central GST.
States will levy and collect the State GST on the supply of goods and services within a state.
The Centre will levy the Integrated GST (IGST) on the interstate supply of goods and services, and apportion the state’s share of tax to the state where the good or service is consumed.
The 2016 Act requires Parliament to compensate states for any revenue loss owing to the implementation of GST.

Issues Arisen OR Unresolved

Not all items are covered: Taxation for certain items such as Alcohol, Tobacco etc. are still not under the GST domain. States argue that including them would hamper their revenue and they would suffer a huge resource. However, some experts say that the real reason is the nexus of politicians with some business class and high-profile lobbying. Further, the Finance minister of India has said in the parliament that the consensus to include alcohol and tobacco under the GST regime is possible in foreseeable future.
Decision criteria for the tax bracket: There are apprehensions that how to decide about the items and the criteria that which item will fall into which tax bracket. It may lead to lobbying. To this, the Finance minister has said that the decision will be taken by the GST Council only after due diligence and most probably by consensus.
Multiple tax rates and brackets: The philosophical idea that GST means “One Nation one Tax” is currently diluted due to multiple tax rates and brackets. To this, the Finance minister has said that since the target consumer of goods and services have different capabilities and therefore there must be a system similar to the democratic lines where higher value consumer pays more taxes .
Power to impose tax taken away by Central Government from the Parliament: The Central GST Bill, 2017 allows the central government to notify CGST rates, subject to a cap. This implies that the government may change rates subject to a cap of 20% , without requiring the approval of Parliament. Under the Constitution, the power to levy taxes is vested in Parliament and state legislatures. Though the proposal to set the rates through delegated legislation meets this requirement, the question is whether it is appropriate to do so without prior parliamentary scrutiny and approval.
Confusion regarding the location of consumption: Under GST, both state and the Centre can tax the services based on their location of consumption . Now the confusion arises since the general rule to determine the location of the recipient is his location or address on record; there are specific rules for various services such as telecom, property, transportation, etc. This means that while a service may be consumed across multiple states, the tax revenue would be attributed to the state where the recipient is registered or his office is located. This could lead to higher taxes attributed to states that have more registered offices. For example , suppose a company is located in Bangalore and advertises its products in the Kolkata edition of a newspaper, which has its registered office in Delhi. In this case, one may argue that the service is being finally consumed in Kolkata. However, as the recipient of services is in Bangalore, the tax would accrue to Karnataka.
Anti-Profiteering Clause: The government is planning to set up an authority to see if any reduction in tax rates after GST is passed on to the consumer by companies or not. The industry and businesses are not taking this idea kindly and they see it as a backdoor entry of inspector raj. Experts say that prices should be market determined and no government authority has the business of deciding prices for goods and services.
Confusion regarding the control over taxation: To avoid dual control, the GST council has reached a compromised formula. 90 percent of tax assesses with an annual turnover of Rs 1.5 crore or less, will be assessed by states and the rest by the Centre. For those with a turnover of over Rs 1.5 crore, the states and the Centre will share it equally. However, this ‘solution’ has its own set of issues . For example, if an entity with a turnover of less than Rs 1.5 crore in one year, posts a turnover of Rs 1.5 crore in the following financial year, who would be the new authority to take over the assessment? And, how will the existing investigations, if any, against the entity be addressed, and by whom? “There are a lot of procedural issues, and if these issues are not addressed properly, they would lead to litigations.
The issue of casual taxable person: If a person registered in one state moves to another state for a short period for some business transaction – say to participate in a fair or exhibition, then that person would have to get himself registered in that state for that period.

What is GSTN?

GSTN is registered as a not-for-profit company under the Companies Act.
It has been formed to set up and operate the information technology backbone of the GST.
While the Central (24.5%) and the state (24.5%) governments hold a combined stake of 49%, the remaining 51% stake is divided among five financial institutions—LIC Housing Finance with 11% stake and ICICI Bank, HDFC, HDFC Bank and NSE Strategic Investment Corporation Ltd with 10% stake each.
GSTN had awarded Infosys Ltd the contract to develop the hardware and software for GST.
The idea behind GSTN was to set up an entity that is equidistant from both the Central government and the state governments, as it will advise both the Centre and the states on the information technology network

Controversy around GSTN

It is argued by some as a private company and therefore not under government control. It may lead to a breach of tax data into private hands and manipulation of the same for the advantage of some corporates.

To this allegation, the Finance minister replied in the parliament that this arrangement was decided by the empowered committee of the previous government and the present government has endorsed it by considering the fact that private professionals are required for a such a high-octane system. Further, he said that if in future there seems to be any problem with the current structure then it can be changed through the GST Council debate and discussion.

Further, the GSTN website clarifies that the strategic control over GSTN is with the government given the sensitivity of the role of GSTN and the information that would be available to it. The strategic control of the government over GSTN is ensured through measures such as the composition of the board, mechanism of special resolution and shareholders agreement, induction of government officers on deputation and agreements between GSTN and governments.

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Reader Interactions

April 21, 2017 at 7:09 pm

Very nice informative article …very much helpful .. thanks for your great work keep writing

May 5, 2017 at 8:04 pm

lucidly explained……highly recommended for gs-3

June 25, 2017 at 9:14 pm

Can you explain what is meant by Destination based taxation system as mentioned in Point 1

March 25, 2023 at 6:01 pm

Destination based means the taxes Levied at the place(state) where product sell origin based means the taxes levied at the place where product manufacture

May 12, 2023 at 9:00 am

Destination based Means at Point of Sale. Where Goods are sold. Tax on Value addition by the seller.

July 1, 2017 at 12:19 pm

Easily explained

December 9, 2017 at 12:24 pm

Good and easily understandable with full content.

March 27, 2018 at 11:07 am

Hi. Good information about GST.but I have one query.I m staying in rental house.My rent agreement didn’t support for commercial work.and I don’t have any other property to commercialise for gst.and I am a designer.i need GST to work.now what to do?how can I start work without gst?

June 26, 2019 at 7:16 am

Kindly include date of publishing to know how recent the article is

January 23, 2020 at 2:19 pm

Ruby Bhatia – This is a wrong place to ask such question.This is a UPSC preparing website You can check such queries at cleartax ,bankbazaar etc P.S. Now that you have made your agreement.You can ask your landlord to provide an NOC stating that he allows you to do commercial activity.You will be easily able to find that NoC format online on google. People who have SME’s cannot afford commercial place or who want to do e-commerce business.Thus its possible to get your GSTIN from the residential rent agg

April 13, 2024 at 11:25 pm

Great job on your blog post! The information was presented in a way that was easy to comprehend, and I particularly enjoyed the real-life examples you shared.

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Essay on GST 1000+ Words

The Goods and Services Tax, commonly known as GST, is a monumental taxation reform in India that has transformed the way goods and services are taxed and simplified the complex tax structure. In this essay, we will explore the significance of GST in India, its impact on the economy, and why it’s considered a game-changer.

The Need for Reform

Before the introduction of GST, India had a complex taxation system with multiple taxes at the state and central levels. This complexity led to confusion and tax evasion and hindered the ease of doing business. GST aims to streamline this system.

A Unified Taxation System

GST brought various indirect taxes into a single, unified taxation system. It eliminated the cascading effect of taxes, where taxes were levied on top of taxes, reducing the overall tax burden on goods and services.

Simplicity and Ease of Compliance

GST simplifies tax compliance for businesses. It introduced a common online platform for tax filing, making it easier for businesses to register, file returns, and pay taxes. This reduced the bureaucratic hurdles and corruption associated with the previous system.

Impact on Prices

One of the primary concerns during the GST rollout was its impact on prices. While some goods became cheaper due to reduced taxes, others saw a slight increase. However, over time, GST stabilized, and the overall impact on prices has been positive.

Boosting Economic Growth

GST has played a significant role in boosting economic growth. It has made it easier for businesses to expand, reduced logistics costs, and promoted the ease of doing business, attracting both domestic and foreign investments.

Reducing Tax Evasion

GST has a robust mechanism to track transactions and detect tax evasion. This has led to increased compliance and a reduction in the informal economy, benefiting the government’s revenue collection.

Simplifying Interstate Trade

Before GST, interstate trade faced many challenges due to different state tax laws. GST has simplified interstate transactions, making it easier for goods and services to move across state borders.

Challenges and Concerns

While GST has brought about numerous benefits, it also faces challenges such as the need for continuous updates and addressing issues related to small businesses and compliance.

Future Prospects

GST is continually evolving to address challenges and improve its efficiency. The future of GST in India looks promising, with a focus on making it more taxpayer-friendly and digitally driven.

Conclusion of Essay on GST

In conclusion, the Goods and Services Tax (GST) has been a transformative taxation reform in India. It has simplified the taxation system, reduced tax evasion, and contributed to economic growth. While challenges remain, GST’s positive impact on the Indian economy cannot be denied. It has made India a more attractive destination for businesses and investments and has paved the way for a more transparent and efficient tax regime. As GST continues to evolve, it holds the promise of further enhancing India’s economic growth and development, making it a cornerstone of the country’s fiscal policies. The journey of GST reflects India’s commitment to progress and reform, and it remains an essential part of India’s economic future.

Also Check: The Essay on Essay: All you need to know

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Goods and Services Tax (GST)

13 Jul 2020
10 min read
GS Paper - 3
Government Policies & Interventions
Growth & Development
Constitutional Bodies

Introduction

The Goods and Services Tax (GST) is a value-added tax levied on most goods and services sold for domestic consumption. The GST is paid by consumers, but it is remitted to the government by the businesses selling the goods and services.

Main Features of GST

Applicable On supply side: GST is applicable on ‘supply’ of goods or services as against the old concept on the manufacture of goods or on sale of goods or on provision of services.
Destination based Taxation: GST is based on the principle of destination-based consumption taxation as against the present principle of origin-based taxation.
Import of goods or services would be treated as inter-state supplies and would be subject to Integrated Goods & Services Tax (IGST) in addition to the applicable customs duties.
GST rates to be mutually decided: CGST, SGST & IGST are levied at rates to be mutually agreed upon by the Centre and the States. The rates are notified on the recommendation of the GST Council.
Multiple Rates: Initially GST was levied at four rates viz. 5%, 12%, 16% and 28%. The schedule or list of items that would fall under these multiple slabs are worked out by the GST council.

Legislative Basis Of GST

In India, GST Bill was first introduced in 2014 as The Constitution (122nd Amendment) Bill.
Central GST to cover Excise duty, Service tax etc, State GST to cover VAT, luxury tax etc.
Integrated GST to cover inter-state trade. IGST per se is not a tax but a system to coordinate state and union taxes.
Article 246A – States have power to tax goods and services.
Article 279A - GST Council to be formed by the President to administer & govern GST. It's Chairman is Union Finance Minister of India with ministers nominated by the state governments as its members.
The council is devised in such a way that the centre will have 1/3 rd voting power and the states have 2/3 rd .
The decisions are taken by 3/4 th majority.
Creation of common national market: By amalgamating a large number of Central and State taxes into a single tax.
Mitigation of cascading effect: GST mitigated ill effects of cascading or double taxation in a major way and paved the way for a common national market.
Reduction in Tax burden: From the consumers’ point of view, the biggest advantage would be in terms of reduction in the overall tax burden on goods.
Making Indian products more competitive: Introduction of GST is making Indian products more competitive in the domestic and international markets owing to the full neutralization of input taxes across the value chain of production.
Easier to administer: Because of the transparent and self-policing character of GST, it would be easier to administer.

Advantages of GST

For the Government

Create a unified common market: Will help to create a unified common national market for India. It will also give a boost to foreign investment and “Make in India” campaign.
Streamline Taxation: Through harmonization of laws, procedures and rates of tax between Centre and States and across States.
Increase tax Compliance: Improved environment for compliance as all returns are to be filed online, input credits to be verified online, encouraging more paper trail of transactions at each level of supply chain;
Discourage Tax evasion: Uniform SGST and IGST rates will reduce the incentive for evasion by eliminating rate arbitrage between neighbouring States and that between intra and inter-state sales.

For Overall Economy

Bring about certainty: Common procedures for registration of taxpayers, refund of taxes, uniform formats of tax return, common tax base, common system of classification of goods and services will lend greater certainty to taxation system;
Reduce corruption: Greater use of IT will reduce human interface between the taxpayer and the tax administration, which will go a long way in reducing corruption;
Boost secondary sector: It will boost export and manufacturing activity, generate more employment and thus increase GDP with gainful employment leading to substantive economic growth;
Ultimately it will help in poverty eradication by generating more employment and more financial resources.

For the Trade and Industry

Simpler tax regime with fewer exemptions.
Increased ease of doing business.
Reduction in multiplicity of taxes.
Elimination of double taxation on certain sectors.
More efficient neutralization of taxes especially for exports
Making our products more competitive in the international market.
Simplified and automated procedures for registration, returns, refunds and tax payments.
Decrease in average tax burden on supply of goods or services.

For Consumers

Transparent prices: Final price of goods is expected to be transparent due to seamless flow of input tax credit between the manufacturer, retailer and service supplier.
Price reduction: Reduction in prices of commodities and goods in long run due to reduction in cascading impact of taxation;
Poverty eradication : By generating more employment and more financial resources.

For the States

Expansion of the tax base: As states will be able to tax the entire supply chain from manufacturing to retail.
More economical empowerment: Power to tax services, which was hitherto with the Central Government only, will boost revenue and give States access to the fastest growing sector of the economy.
Enhancing Investments: GST being destination based consumption tax will favour consuming States. Improve the overall investment climate in the country which will naturally benefit the development in the States.
Increase Compliance: Largely uniform SGST and IGST rates will reduce the incentive for evasion by eliminating rate arbitrage between neighbouring States and that between intra and inter-state sales

Exemptions under GST

Custom duty will be still collected along with the levy of IGST on imported goods.
Petroleum and tobacco products are currently exempted.
Excise duty on liquor, stamp duty and electricity taxes are also exempted.

Challenges Of GST

SCGT and CGST input credit cannot be cross utilized.
Manufacturing states lose revenue on a bigger scale.
High rate to tax to compensate the revenue collected now from multiple taxes i.e High Revenue Neutral Rate.
The reduction in the fiscal autonomy of the States.
Concerns raised by banks and insurance companies over the need for multiple registrations under GST.
The levy of additional cess.
The capacity of State tax authorities, so far used to taxing goods and not services, to deal with the latter is an unknown quantity.
The success of GST depends on political consensus, technology and the capacity of tax officials to adapt to the new requirements.

Thus GST is a positive step towards shifting Indian economy from the informal to formal economy. It is important to utilise experiences from global economies that have implemented GST before us,to overcome the impending challenges.

Home » Knowledge Base » GST and its Impact on Business in India [Student Essay]

GST and its Impact on Business in India [Student Essay]

Saumya Snehal
Apr 11, 2017
43 Comments

A just and viable tax regime is vital for the sustainable economic growth and fiscal consolidation of any economy in the world.

This assumes a greater importance in a developing economy like India where although we have a high demographic dividend, we are yet to convert it to the proportionate human capital, which will in turn benefit the social and economic growth of the country.

In order to facilitate this, we need a conducive environment as we push forward towards becoming a better developed nation.

In order to become a more economically developed nation, we need a transparent, just, equitable and fair taxation system that is easy to administer.

The essential rationale behind this is that the taxation system should be reasonable and non-discriminatory in respect to both the direct taxes payable by individuals and the indirect taxes payable by corporations and industries so as to make them more tax-compliant and bring the larger populace in the taxation net to in turn aid the government in taking development projects.

Goods and Services Tax (GST) is a reformatory legislation which is a single tax on the supply of goods and services, right from the manufacturer to the consumer.

Credits of input taxes paid at each stage will be available in the subsequent stage of value addition , which makes GST essentially a tax only on value addition at each stage.

The final consume will thus bear only the GST charged by the last dealer in the supply chain with set-off benefits at all the previous stages.

NEED FOR GST LEGISLATION

The tax-GDP ratio of a country is an important indicator that helps understand how much tax revenue is being collected by the government as compared to the overall size of the economy and unfortunately, this ratio is a dismal low for India despite having years of high growth, the lowest in BRICS countries.

From 2001 to 2015 the Indirect Tax-GDP ratio has increased from 10.28-11.6 only and therefore there is an urgent need to raise this ratio.

The burden of regressive taxes is another issue that the GST aims to redress. Direct taxes are progressive taxes as they are contingent on the ability of the taxpayer to pay.

In India, more than 60% of the total tax collected is accounted for indirect taxes, implying that the tax structure is extremely regressive and since the rich and poor are subject to the same tax rate which is unfair and therefore the indirect taxes need to be hauled.

Furthermore, the sharing of financial resources and revenue from the tax system between the Centre and the State is made simpler by the GST tax reform.

Furthermore the cascading of taxes with both the Centre and State levying taxes as the taxes levied by the State Government are not available to set off against the taxes being levied by the State Governments.

At the central level GST will subsume Central Excise Duty, Additional Excise Duty, Service Tax, Additional Customs Duty (Countervailing Duty), and Special Additional, Duty of Customs. At the State level, Subsuming of State Value Added Tax/ Sales Tax, Entertainment Tax, Central Sales of Tax, Octroi and Entry Tax, Purchase Tax, Luxury tax, Taxes on lottery, betting and gambling.

Also, the variety of VAT tax laws in the country with disparate tax rates and dissimilar tax practices divides the country into separate economic spheres thereby creating tariff and non tariff barriers thereby hindering the free flow of trade in the country.

This in turn also constitutes high compliance cost for the taxpayers disadvantageous to economic growth of a country.

GSTN, the Goods and Services Tax Network:

Along with GST, there are a number of reforms that the Government is bringing in to strengthen the manufacturing bone of India.

GSTN, the Goods and Services Tax Network is being setup with the objective to provide the requisite IT infrastructure and services for the proper roll-out and implementation of GST.

It is a company under Section 25 which implies that its is a non government, private limited company which will not work for profit.

The division of powers is such that the Central Government holds 24.5% equity in GSTN while the states inclusive of NCT of Delhi and the union territory of Puducherry and the Empowered Committee of the State Finance Ministers collectively hold another 24.5%, the remaining 51% vests with other Government financial institutions.

This company will work towards providing a proficient GST Eco-System. It will encourage and collaborate with GST Suvidha Providers to roll out GST applications for providing simplified services to the stakeholders.

It is also entrusted to carry out research in order to conclude better and best practices and to indulge in staff training and also consultancy to the Tax Authorities and other stakeholders.

Another very important feature of the GSTN is to develop Tax Payer Profiling Utility which is a very important aspect in ensuring efficient administration and achieve the GST goals.

GST Council

This is the most important aspect of the Goods and Services Tax, in ways bigger than the GST bill too, as the entire structure of GST is contingent on this foundation.

It is an apex body headed by the Union Finance Minister Mr. Arun Jaitley with the State-nominated ministers and the Union Minister of State for Finance( In charge of Revenue) as members.

It is imperative to note that the decisions of the GST Council will shape whether this ambitious tax reform will achieve its due desired effect or not.

IMPACT OF GST:

Major Benefits to the Economy As A Whole:

• The present scenario of differing tax rates in different states obstructs cooperative federalism.

GST will bring uniformity and also deplete the cascading consequence of these taxes by giving input tax credit, having a comprehensive tax inclusion with minimum exceptions which will in turn help the Industry to benefit from the proposed common procedures and claim credit for the tax paid.

• GST is expected to increase the mobilization of resources available for property alleviation and development of the country as pointed out by the Prime Minister, Narendra Modi.

This will take place in two ways: (a) directly the resources available to the poorer states will increase substantially; (b) indirectly as the tax base becomes more buoyant.

• The common base and common rates across goods and services and very similar rates across Centre and States will result in effective administration and increase compliance while also ensuring the better management of taxes collected in the State.

Also, there is a provision to maintain the requisite fiscal autonomy to the States with the power to levy additional excise taxes on certain “sin” goods like, tobacco, alcohol, etc.

• The complicated tax-levy system categorized by distortions between States and Cente which divides the country into separate economic zones with the help of GST will become one common national market.

This impedes the Make in India process which will get a boost through GST as it is making tax compliance easier and removing ambiguity and at the same time as GST will be applied on imports, domestic manufacturing would be encouraged.

• Tax Governance will get a positive boost through this regime, mainly, through the feature of input tax credit.

To claim input tax credit, each dealer has an incentive to request documentation from the dealer behind him in the tax chain which will ensure tax compliance. Also this would further require producers to buy materials from registered dealers and therefore will bring in more and more vendors in the taxation net.

Furthermore, the dual monitoring structure of the GST by both Centre and State will make tax evasion more prone to detection.

• There will be reduction in prices of goods as taxes would now be exempted from the production cost and at the same time it will put better goods and services within the reach of a larger number of the populace and as such increase the living standards of the country.

• The successful implementation of GST would give a strong signal to the foreign investors about India’s increased creditworthiness, lesser compliance and procedural costs in the taxation sphere and remove the complexities faced by the foreign investors who were reluctant to invest in consonance with the existence of virtual economic zones throughout the country.

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43 Responses

Thanku so much and essay is Awesome

Very nice essay

It will really help in my examination

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Nice ….n help me in my forthcoming exam

Comment:nice essay and esay

Comment:very nice

Nice yojna GST Nice work

Amazing and interesting But very helpful to understand GST

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Four years of GST: The good, bad and ugly

Image for representational purpose (FIle Photo | PTI)

NEW DELHI: On Friday, Tamil Nadu Finance Minister P Thiaga Rajan sparked a controversy, when he said that the implementation of the Goods and Services Tax (GST) was faulty and that there is a need to re-tool and restructure it.“Sensible people may agree or disagree on a design or system or platform, but logic says you keep re-evaluating based on the outcomes. Have you achieved the goals you wanted? Have you avoided the failures you feared? If the answer to both those is ‘no,’ logical people would say ‘re-tool, re-structure’,” Rajan said while addressing a virtual meeting organised by IIM-B’s Alumni Association, Chennai Chapter on ‘Tamil Nadu: The Road Ahead’. The criticism may sound “strongly worded” but as the GST regime is set to complete four years this week, even its strongest supporters agree that the GST regime is still a work in progress and there is a need for many structural changes for a more stable and hassle-free system.

Good intent, but marred by tech glitches & design flaws

Introduced as one of the biggest economic reforms by the BJP-led Modi government, the GST kicked off with the promise to streamline taxation and compliance burden. Experts also claimed that in many ways, it has streamlined the process. “Based on the one nation one tax ideology, GST has helped in reducing the cascading effect of tax considerably. Also, multiplicity of compliances under various indirect taxes has been reduced. Hence, introduction of GST in India has brought in efficiencies in indirect tax compliance, incidence and reduced the number of indirect tax authorities that a taxpayer needed to interact with,” said Saloni Roy, senior director, Deloitte India.

Another positive is the concept of e-invoicing which seeks to ensure greater transparency in supplier-receiver transactions. The introduction of e-way bill coupled with the crackdown on fake invoicing has helped in bringing in a substantial portion of GST revenues, which were either being evaded or under-reported, in order.

However, the technical glitches, difficulty in claiming input tax credit and ever changing rules make compliance a cumbersome business.“Input Tax Credit (ITC) is an area which has certain limitations that need to be addressed. The GST regime sought to have a seamless flow of ITC, however, conditions for availing ITC being stringent, many taxpayers lost out on ITC. Also, taxpayers lose their ITC due to non-reporting or mistakes by their suppliers,” Roy said.

That apart, taxpayers are also complaining about the imposing an arbitrary monetary limit on availing input tax credit through Rule 36(4) and mandating that a certain percentage of GST has to be paid in cash. These laws are making life difficult for even the most honest taxpayers.In the initial years of GST rollout, former finance minister Arun Jaitley had promised to reduce the tax slabs to three by merging 12 per cent and 18 per cent slabs. However, it remains a distant reality after so many years. Falling revenue amid disruptions causued by the Covid-19 pandemic has continuously delayed the reform, leaving a large number of items in high tax slabs. Lack of clarity on many rules is also leading to various litigation and different interpretations (of the same laws) by Advanced Ruling Authorities in different states.

“The government needs to establish GST Tribunals to reduce litigation timelines and the pressure on courts. The state authorities for Advance Ruling should ideally also have an independent jurist member, apart from a representative from the tax department,” Roy suggests. Centre Vs States When the states had agreed to the GST implementation, they knew they had to let go of some share of their taxes. But the Centre promised to compensate the state with revenue foregone for the first five years after implementation of GST.

The nationwide lockdown, however, intensified the problem of revenue shortfall for states with the Centre not paying up the dues on time. Also with coffers drying up and with social and health spending going up, states are growing disenchanted with the system. “We knew we were losing our independence of taxation as States. Already all direct taxation was Centre, the indirect was partially with us and the Centre. We went in with a lot of trepidation and fear and some hope of outcomes that would give long term and widespread benefit,” Rajan said, adding that five years down the line, fears have grown immensely while the benefits have not even been realised by 20-30 per cent. This largely sums up the frustration faced by many states.

Meanwhile, the meetings of the GST Council are not as frequent as they were earlier, if the recent incidents are anything to go by, and it often end up with disagreement, fight and strong letters and statements. States have also accused the Centre of cornering a substantial portion of tax in forms of cess. Last year, the GST Council had borrowed `1.1 lakh crore to pay the states in order to make up for the shortfall. Still, `63,000 crore is pending which the Centre intends to pay this year.

Road ahead As the GST council is likely to meet soon to decide on this year’s compensation, the opposition-ruled state governments are likely to seek an extension of GST compensation on their revenues beyond June 2022, when the five-year window ends. The Fifteenth finance commission, in its latest report, has addressed many issues including large shortfall in collections as compared to original forecast, high volatility in collections, accumulation of large integrated GST credit, glitches in invoice and input tax matching, and delay in refunds. The Commission also observed that the continuing dependence of states on compensation from the central government for making up for the shortfall in revenue is a concern. While at the same time it suggested that the structural implications of GST for low consumption states need to be considered.

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Gst and Taxation in India: The Way Ahead

Categories: India Taxation

About this sample

Words: 1538 |

Published: Jul 17, 2018

Words: 1538 | Pages: 3 | 8 min read

Works Cited

https://www.taxmann.com/blogpost/2000000031/what-is-gst-goods-and-services-tax-in-india.aspx
https://blogs.economictimes.indiatimes.com/figuringitout/way-ahead-is-to-reform-indirect-tax-regime-with-gst/
https://www.tradebriefs.com/index.php/component/content/article?id=466419
https://cleartax.in/s/gst-law-goods-and-services-tax. http://www.cbec.gov.in/htdocs-cbec/gst

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Essay on GST

In many schools, students are asked to write an Essay on GST .

Many students often struggles, while few of them get confused to write a descriptive essay on GST ( Goods and Service Tax ).

In this post, we had provided detailed information about Goods and Services Tax (GST), types of GST , how does it work.

You’ll also learn the advantages & disadvantages of GST and what are its effects on GDP are also discussed.

Let’s get started…

The Goods and Services Tax or GST is the new indirect tax system of the Government of India which is coming into effect from 1 July 2017 .

Essay on GST in 250 words:

GST is an abbreviation for Goods and Services Tax, India. It is a similar indirect tax, which is imposed by both the central and state governments, replacing different indirect taxes at different stages.

GST considers India a big market, whatever it may be, after a uniform tax government across the country.

Although GST is charged from the next customer by all registered dealers in the supply chain (raw material supplier, manufacturer, wholesaler, retailer and consumer), the ultimate burden of tax is on the end customer i.e. the consumer.

All other GST registered dealers act as middlemen, who collect GST from the consumer and give it to the government, receiving tax credits in return.

This tax credit is called the “input tax credit” and is held against the GST charged by the dealer to the customer in which he supplies the goods.

Any registered dealer is also eligible for a tax refund if the input tax credit exceeds the output tax credit, as per the provisions provided by law in this regard.

Further, no GST credit can be claimed for the purchase of discounted goods. GST is not imposed on all types of vegetables, organic manures, contraceptives, printed books, stamp papers, agricultural implements etc.

GST in India Essay 500 Words:

The Goods and Services Tax or GST is a comprehensive, multi-level, destination-based tax that will be imposed on every value.

To understand this, we have to understand the words under this definition.

Let us start with the word ‘multi-level’. Any item passes through several stages from manufacture to final consumption.

The first step is to buy raw materials.

The second stage is production or manufacturing.

And in the last stage, the retailer sells the final product to you or the end consumer. Also, read GST Essay Conclusion.

How GST works:

Nationwide tax reform cannot work without strict instructions and provisions.

The GST Council has devised a method of implementing this new tax system by dividing it into three categories.

When GST is implemented, there will be 3 types of taxes:

CGST: where revenue will be collected by the central government

SGST: Revenue will be collected by state governments for sales in the state

IGST: where revenue will be collected by the central government for interstate sales

In most cases, the tax structure under the new regime will be as follows:


In-state sales	CGST + SGST	VAT + Central Excise / Service Tax	Revenue will now be shared between Center and State
Sale to another state	IGST	Central Sales Tax + Excise / Service Tax	There will now be only one type of tax (central) in case of interstate sales.

The GST rate is 18% which includes the CGST rate of 9% and the SGST rate of 9%.

In such cases, the dealer collects Rs. 1800 and in this amount Rs. 900 will go to the Central Government and Rs. 900 will go to the Government of Maharashtra.

So now the dealer has to pay Rs. 1800 IGST & CGST and SGST will not have to be paid.

Conclusion:

The main reason for GST is to bring the whole of India under a uniform tax regime.

This has reduced the unnecessary tax burden of various state and central taxes on dealers and made goods cheaper for both investors and the consumer.

Essay on GST Bill in 1000 Words:

Goods and Services Tax, India GST for short is a tax based on the consumption of goods or services across India. GST is an indirect tax that has replaced previous indirect taxes. Direct taxes such as income tax, corporate tax etc. are not affected by GST.

History of GST:

The Goods and Services Tax (GST) was proposed in 1999 under the government of the then Prime Minister of India, Atal Bihar Vajpayee.

Also, a committee was set up by Prime Minister Vajpayee to prepare the GST model by the then Finance Minister of West Bengal Aseem Dasgupta.

Since then, the GDA could not be implemented, most recently on 1 July 2017.

The NDA (National Democratic Alliance) government formed the government led by the BJP (Bharatiya Janata Party).

Advantages of GST:

Tax affects cascading:

The cascading tax effect can be described as ‘tax on tax’, would eliminate this previous cascading effect of the tax.

High limit of registration:

In the VAT structure, it was mandatory to pay VAT to do other business with a turnover of more than 500000, although this limit has been increased to 2000000 with new Goods and Services Tax, which is beneficial for many small traders.

Structure plan:

It gives an option to reduce tax by using tax structure scheme i.e. tax and compliance burden on small businesses have been reduced under Goods and Services Tax.

Easy online process:

The entire process of Goods and Services Tax system has been made online so that it is easy for the user and does not get entangled in external useless rounds.

Regular occupation:

Before this new tax, considerable industries were largely unregulated and unorganized. There has been regularity in industries under the Goods and Services Tax. Also, read GST Essay FAQ .

Disadvantages of Goods and Services Tax (GST):

Cost overruns:

For efficient use of new billing software, software purchases and staff training leads to increased costs.

Goods and Services Tax Compliance:

Small and medium enterprises have to understand the specifics of the Goods and Services Tax system.

Maintenance of digital records should be consistent, if the Goods and Services Tax Complaint Challan is issued, it should contain the mandatory details, like a place of supply, HSN. Code etc.

Increase in operating costs:

Employment of specialists will suffer additional costs, this will increase the cost for small businesses.

Problem with the online application:

Since the Goods and Services Tax is an online taxation system, filing details can be difficult for some small businesses.

Additionally, small businesses, in particular, will face difficulties, as earlier only businesses above Rs 1.5 crore had to pay excise duty, but now businesses with more than ₹ 2000000 pay Goods and Services Tax.

Although one can choose the structure plan, it will also be a difficult and lengthy process.

Importance of GST in India:

GST plays an important role in changing the current tax structure and the economy.

Currently, the Indian tax structure is divided into two – direct and indirect taxes.

Direct tax or direct tax is one in which liability cannot be passed on to anyone else.

An example of this is income tax where you earn income and only you are liable to pay tax on it.

In the case of indirect taxes, the tax liability can be passed on to another person.

This means that when the shopkeeper pays VAT on his sale, he can give liability to his customer.

Therefore the customer pays on the price of the item and VAT so that the shopkeeper can collect VAT to the government.

Meaning the customer not only pays the price of the product, but also has to pay the tax liability, and therefore, it costs more when he buys an item.

This is because the shopkeeper had to pay tax when he bought the item from the wholesaler.

To recover the VAT paid to the government along with the amount it collects, it gives the liability to its customer who has to pay the additional amount.

Whatsoever is paid out of his pocket for the shopkeeper during the transaction, there is no other way for him to claim the refund and hence, he has no option but to pass on the liability of the customer.

Also, read 1. Cashless Economy Essay 2. Globalization Essay 3. Demonetisation Essay

Conclusion for GST Essay:

GST will lead to a more transparent and corruption-free taxation system; it is designed in such a way that it benefits both businesses and consumers.

India needed better tax reform on indirect tax like Goods and Services Tax.

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Enjoy The Beauty Of Nature With These Budget Friendly Tips Which Help In Explore Raichur

Unearth the gems of history and culture waiting in raichur, karnataka, without worrying about your budget. this guide will give you practical advice on how to appreciate the region's captivating beauty without spending a fortune. get the inside scoop on making your journey to raichur memorable without heavy pocket losses. dive into the lesser-known treasures of this indian metropolis..

Ishika Jain Updated: Sep 13, 2024 7:05 AM IST

Raichur, located in the heart of Karnataka, India, is a treasure trove of culture, history, and natural beauty waiting to be discovered. While travel can sometimes strain the wallet, exploring Raichur doesn't have to break the bank. In this guide we will show you how to save money while making your trip unforgettable.

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There are many options for accommodation in Raichur that cater for all budgets. Choosing guesthouses, homestays or budget hotels could significantly cut costs but still ensure comfortable stays. Websites such as Airbnb, OYO and Booking.com usually have affordable accommodations within and around Raichur.

2. Local Transport

Raichur has an efficient public transport system that makes it easy and cheap to move around. Moving around the city and its environs can be done by use of local buses , auto-rickshaws or cycle rickshaws . Additionally , renting a bicycle or scooter for the day allows one to move at their pace hence cost effective.

3. Culinary Delights

4. Free Attractions

Even if you have no money to spend during your visit to Raichur, you can still enjoy some great attractions that will expose you to various aspects of the city's past and present. Go to the ancient temples such as Raichur Fort, Ek Minar ki Masjid and Aam Talab if you are interested in its heritage. Take a gentle walk along Tungabhadra River or join people in the local markets such as Raichur Vegetable Market to experience real life.

5. Cultural Experiences

You can get a taste of Raichur's culture without spending too much through various budget-friendly activities including festivals, cultural performances and religious ceremonies. Watch out for events like Hampi Utsav, Dasara and Ugadi celebrations that give you an insight into traditional rituals and customs many of them are free or have very small charges.

Exploring Raichur on a budget is not only feasible but also enriching, allowing travelers to experience the essence of this enchanting city without overspending. By following these budget-friendly tips you will be able to make most of your trip while creating unforgettable memories that won't hurt your pockets so pack your bags hit the road ... .and discover incredible enchantment of Raichur on a shoestring budget.

Topics News">Raichur
Topics News">Raichur Tourism
Topics News">Raichur Tourist Places
Topics News">Raichur Travel Diaries

COMMENTS

Long and Short Essay on GST in English for Children and Students
Short Essay on GST in India - Essay 2 (150 Words) Goods and Services Tax, India is a uniform tax levied on goods and services, treating whole of India as one market. The tax came into effect from 1 st July 2017 and replaced the existing multi level central and state taxes. GST divides goods and services into five tax slabs - 0%, 5%, 12%, 18 ...
Paragraph on GST in English (100, 150, 200, 250 Words)
Paragraph on GST in English (100, 150, 200, 250 Words) Goods and Services Tax (GST) is a unified tax system implemented in India since July 1, 2017. It replaces multiple indirect taxes with a single tax structure, aimed at simplifying taxation and fostering economic growth. This tax reform impacts businesses, consumers, and the overall economy.
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Introduction GST is an acronym for goods and services tax. The GST has been introduced as a part of the reforms in India's taxation system to make the process simplified and more transparent. In this essay, we will discuss what GST is, how it is applied, the problem faced by businesses as well as common people due to GST implementation and the possible solutions that the government can take to ...
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Paragraph on GST in 150 words The Goods and Services Tax (GST), introduced in India on July 1, 2017, is a comprehensive, multi-stage, destination-based tax that is levied on every value addition.
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Essay on GST: GST or Goods and Services Tax, India is a tax based on the usage of goods or services across India. GST is an indirect tax replacing the previous indirect taxes imposed on the goods and services. Direct taxes such as income tax, corporate tax, etc., are not influenced by the GST. Everything you need to know about GST essay writing, Essay on GST in English, Essay GST.
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GST Essay 10 Lines (100 - 150 Words) 1) GST is a newer tax system adopted in India on 1 st April 2017. 2) All the earlier indirect taxes are now replaced by GST. 3) GST was first adopted by France, later many countries joined it. 4) GST is a good system to avoid corruption in the tax regime. 5) 0%, 5%, 12%, 18%, and 28% are the five slabs of ...
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Essay on GST in 200 words. "GST stands for 'Goods and Services Tax'. It is a uniform indirect tax levied on the 'supply' of goods or services and not on the manufacture of goods on the sale of goods or provision of services. India borrowed its GST model from the Canadian Dual GST model.'. Playback cannot continue.
Essay on GST in English (जीएसटी पर निबंध)
Objective and conclusion. Introduction- GST. GST stands for goods and services tax which could be also referred to as an indirect tax, levied on the supply of goods and services. It is applied at every step of the production process. It is the government of India who levies this tax. Well, GST came into effect from 1st July 2017 by one hundred ...
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This impedes the Make in India process which will get a boost through GST as it is making tax compliance easier and removing ambiguity and at the same time as GST will be applied on imports, domestic manufacturing would be encouraged. • Tax Governance will get a positive boost through this regime, mainly, through the feature of input tax credit.
Four years of GST: The good, bad and ugly
NEW DELHI: On Friday, Tamil Nadu Finance Minister P Thiaga Rajan sparked a controversy, when he said that the implementation of the Goods and Services Tax (GST)
GST and Taxation in India: [Essay Example], 1538 words
The way Ahead Goods and Service Tax (GST) was rolled out in India on July 1st 2017, after several rounds of dead lock in the parliament. Observers have... read full [Essay Sample] for free
Essay on GST in English
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