The taxes collected from the citizens are used for various kinds of construction maintenance and welfare purposes. According to the distinct responsibilities that the government has to perform, a rise in the tax revenue is often essential. The goods and service tax is simultaneously imposed by both the center and the state. There are 3 different kinds of tax forms. The goods and Service Tax is categorized into the CGST, IGST, and SGST respectively.
CGST is the abbreviated form of Central Goods and Service Tax. This is imposed by the intra-state provision of both the products and services offered by the central government and hence the name. However, the state goods and service tax abbreviated as SGST is governed by the interstate supply of state governments. This signifies that both the central as well as the state governments will have a particular portion of share in the revenue collected. This is however finalized with an agreement between them, and the revenue collected from the combination of the imposed taxes is divided accordingly. Section 8 of GST act mentions that although taxes are levied on every intrastate supply of any kind of product or services, the rate of tax in any way should not exceed 14 percent each.
The steps in GST return filing procedure is incredibly easy for every normal taxpayer. The integrated goods and service tax abbreviated as IGST is imposed on the interstate supplies of the products and services. This is determined by the IGST act. This integrated goods and Service Tax is applicable for both the import and export of goods and services, into India and from India. When IGST is applicable the exports are zero-rated. The collected tax will be proportionately shared between the state and central government.
GST accounting is a very easy process. The steps in the online portal are very convenient to use by all the users. First, the integrated goods and service tax liability is set off, and after that the central goods and service tax. In the end, the remaining credit is mostly used to set off the state goods and service tax. However, all the three kinds of taxes serve the main purpose of one nation, one tax, and the dual tax system. In the former case, the whole tax will be available as credit for every kind of purchase. And in case of the dual tax system, both the center as well as the states will have their share of revenue.
The goods and service tax is a completely new concept in the field of tax payment. The place of supply and upcoming tax structures are being brought up in the concept of it. This results in confusion with the taxpayers who ultimately end up subsidizing for the wrong type and amount of GST. The journey of GST began in 2000 in India, by the setup of an organization to draft law. Ultimately in 2017 the Lok Sabha and Rajya Sabha of India passed GST bill. The GST law came into work from 1st July 2017.