GST (Goods and Services Tax) is India’s biggest indirect tax reform. A comprehensive dual GST was introduced in India from 1 July 2017. Current scenario of world economy depicts that more than 140 nations, worldwide use GST system. Like Canada, India adopted dual GST (CGST and SGST) system
Advantages of GST
GST chiefly removes the cascading effect on the sale of goods and services. Elimination of cascading effect directly impact the cost of goods. Since the tax on tax is eliminated in this regime, it ultimately results into the the decrease of cost of goods and services That benefits the end users or citizens.
Mr. Narendra Modi, Honorable Prime Minister keenly emphasizes on digitalization of all major procedures or documentations since BJP government gained the power in central in 2014. GST is one of the most ambitious and visionary decision by The Government of India.
Entire process of GST is digitalized and technologically driven. GST portal has been launched to simplify entire process, gain maximum accuracy and remarkable speed. Using this portal, one can complete all the steps like registration, return filing, application for refund and response to notice very easily.
Advantages of GST:
✓ Elimination of Multiple Taxes
✓ Saving more Money
✓ Ease of business
✓ Easy Tax Filing and Documentation
✓ Cascading Effect deduction
✓ More Employment
✓ Increase in GDP
✓ Reduction in Tax Evasion
✓ More Competitive Product
✓ Increase in Revenue
Disadvantages of GST
✓ Technical issues for Indian Taxpayers
✓ Purchase Reporting in Composition Scheme
✓ Annual GSTR Form Utility
✓ Credit Reversal
✓ No Option for Extra Tax Paid and Refund Challan
✓ GSTR 2A Availability
✓ Agricultural Commission Agent & Joint Development Agreement Issues
✓ GSTR 3B Issues
✓ GSTR 1 Issues
✓ Issues in TRAN 1 form
✓ Some Pertinent Issues for Small Traders
✓ Issues for E-commerce Companies
✓ E-way Bill and Interstate Trade
✓ Evaders Bonanza
✓ GST and Fiscal Fractures
In the GST Regime, businesses whose turnover exceeds Rs. 20 lakhs (for NE and hilly states its Rs 10 lakhs) need to register themselves as a normal taxable person. This process of registration is called GST registration.
For certain businesses, registration under GST is mandatory. If the organization is found to ignore this and continues trade without being registered under GST,they will be charged a heavy pety as as its regarded as an offense.
Who Should Register for GST?
✓ Individuals registered under the Pre-GST law (i.e., Excise, VAT, Service Tax etc.)
✓ Businesses with turnover above the threshold limit of Rs. 20 Lakhs (Rs. 10 Lakhs for North-Eastern States, J&K, Himachal Pradesh, and Uttarakhand)
✓ Casual taxable person / Non-Resident taxable person
✓ Agents of a supplier & Input service distributor
✓ Those paying tax under the reverse charge mechanism
✓ Person who supplies via e-commerce aggregator
✓ Every e-commerce aggregator
✓ Person supplying online information and database access or retrieval services from abroad to an Indian citizen, who is not a registered taxable person yet.
How many returns do I need to file for the GST in a financial year?
Return filing under GST depends upon the nature of your business and the type of registration you have opted for.
If you are normal taxpayer under GST, you are liable to file total thirty-seven returns in one financial year. Three returns in a single month and one annual return.
Practically only 12 monthly returns & 1 annual returns need to be filed in GST.
The penalty for not registering under GST
A penalty of 10% of total amount due or minimum of Rs.10,000 is levied on an offender who fails to pay tax or do a short payments under GST norms. Penalties can reach 100 % of the tax amount because the perpetrator has deliberately avoided paying the tax.