What is GST?

947 Views Updated: 24 Aug 2017
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What is GST?

With India rolling out GST from July 1, 2017, the new economic reform has revolutionized the Indian Taxation system. Standing for 'Goods and Services Tax,' the law is an indirect tax that has replaced all the existent taxes with one tax.

In layman's words, it is a single tax that will be levied on the consumption of goods and services, right from the manufacturer to the end user, i.e. the customer.

Do you think GST will be an effective and transparent form of taxation system in the country? Tell us about it. Comment on the box below to share your opinions on GST.

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Answers (9)

The Central government passed four sets of GST Acts in the Budget session this year. These were Central GST Act, 2017; Integrated GST Act, 2017; Union Territory GST Act, 2017 and GST (Compensation to States) Act, 2017. The Acts were approved by the Parliament after they were introduced as part of the Money Bill. Following the passage of the GST Acts, the GST Council decided the rate slabs for the Goods and Services to be taxed under the GST regime. This guide will help you build a basic understanding of GST, its role in your day to day life and its benefits.

What is GST

GST (Goods and Services Tax) is the biggest indirect tax reform of India. GST is a single tax on the supply of goods and services. It is a destination based tax. GST has subsumed taxes like Central Excise Law, Service Tax Law, VAT, Entry Tax, Octroi, etc. GST is one of the biggest indirect tax reforms in the country. GST is expected to bring together state economies and improve overall economic growth of the nation.


GST is a comprehensive indirect tax levy on manufacture, sale and consumption of goods as well as services at the national level. It will replace all indirect taxes levied on goods and services by states and Central. Businesses are required to obtain a GST Identification Number in every state they are registered.


There are around 160 countries in the world that have GST in place. GST is a destination based taxed where the tax is collected by the State where goods are consumed. GST has been implemented in India from July 1, 2017 and it has adopted the Dual GST model in which both States and Central levies tax on Goods or Services or both.


SGST – State GST, collected by the State Govt.

CGST – Central GST, collected by the Central Govt.

IGST – Integrated GST, collected by the Central Govt.

UTGST – Union territory GST, collected by union territory government

What is GST?

GST (Goods and Services Tax) is the biggest indirect tax reform of India. GST is a single tax on the supply of goods and services. It is a destination based tax. GST has subsumed taxes like Central Excise Law, Service Tax Law, VAT, Entry Tax, Octroi, etc. GST is one of the biggest indirect tax reforms in the country. GST is expected to bring together state economies and improve overall economic growth of the nation.


GST is a comprehensive indirect tax levy on manufacture, sale and consumption of goods as well as services at the national level. It will replace all indirect taxes levied on goods and services by states and Central. Businesses are required to obtain a GST Identification Number in every state they are registered.


There are around 160 countries in the world that have GST in place. GST is a destination based taxed where the tax is collected by the State where goods are consumed. GST has been implemented in India from July 1, 2017 and it has adopted the Dual GST model in which both States and Central levies tax on Goods or Services or both.


SGST – State GST, collected by the State Govt.

CGST – Central GST, collected by the Central Govt.

IGST – Integrated GST, collected by the Central Govt.

UTGST – Union territory GST, collected by union territory government

Goods and Service Tax is a game changer as because with its implementation, a tremendous outflow of benefits are expected. Today in India, there are numerous taxes such as Service Tax, VAT, Excise and many others that are ultimately borne by consumers leading to double taxation or having cascading effect. Post GST, around 17 taxes will be subsumed under one tax regime. Learn Morehttp://unfoldingtax.com/gst-registration-composite-dealer/

GST is a type of indirect tax called Goods Service Tax. This was applied all over India to remove the multiple cascading effects. This tax is based on every sale which is held. The cascading effect means something which is inevitable by the manufacturers who give their goods to the end customer. The process begins in the factory, where the producer buys raw material and pay taxes; then when the additional material purchased is inclusive of tax; then when the retailers label the product it comes again comes inclusive of tax which is paid by the retailer. So, in order to eliminate multiple taxation, government has introduced the phenomena, where the customer doesn’t have to bear the tax which is paid by the producers and retailers. Hence, this is said to be a customer-friendly tax.

On one hand it has proven beneficial but on the other hand, it is also troubling the customers. GST has received mixed reactions!

So far GST has proven to be quite effective. it is a transparent way for collecting taxes and the great thing is that taxes are the same all across India. this is beneficial for the customers as well as the sellers. GST is hassle free and easy to understand and to implement. 

GST can prove to be very convenient for the masses as it will mean one tax that will take care of all the tax related formalities. The confusion caused by multiple taxes could be avoided.

At the first sight, GST appears to be making things very simple for a businessman in India. It establishes one country, one tax system which will benefit many traders and manufacturers. However, the only problem lies in the tax brackets that have been built since as per the GST, several items have been taxed higher than they should be; one of them being the sanitary pads for women. 

GST is short for goods and service tax a,d it is the biggest tax reform in independent India. It clubs all the pre-existing taxes into one and divides commodities on the basis of different tax slabs. This has been put in place to speed up processes that are taxable.

GST has in fact been beneficial for us in great ways. Instead of multiple of taxes being levied, just one simple tax would be levied which would protect people from the corrupt politicians of the country and the billing system will make its way! A person can be found guilty if he does not show the bill on being asked ever.

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