Goods and Services Tax (GST) was introduced by the Government of India to boost the economic growth of India. GST is considered to be the biggest taxation reform in the history of Indian economy. It was introduced to save time, cost and effort. Goods and Services Tax (GST) Act came into effect in 2017. In order to address the complex system in India, the Government introduced 3 types of GST which are given below.
- CGST (Central Goods and Service Tax)
- SGST( State Goods and Service Tax)
- IGST(Integrated Goods and Services Tax)
As per 2016 GST regime, Union Territory Goods and Service Tax (UTGST) was also introduced to account for all the taxations in the Union Territories of India. The power to make any changes in the GST law is in the hands of GST Council. GST Council is headed by the Finance Minister. One hundred and first amendment act, 2016 introduced the GST in India from July 2017.
Aspirants would find this topic very helpful in the IAS Exam.
What is Central Goods and Services Tax (CGST)?
Revenue under CGST is collected by the Central Government. CGST subsumes the below given central taxations and levies.
- Central Excise Duty
- Services Tax
- Central Sales Tax
- Excise Duty
- Additional Excise Duties Countervailing Duty (CVD)
What is State Goods and Services Tax (SGST)?
Revenue under SGST is collected by the State Government. SGST subsumed the following state taxations.
- Luxury Tax
- State Sales Tax
- Entry tax
- Entertainment Tax
- Levies on Lottery
Who Collects IGST (Integrated Goods and Services Tax)?
IGST is charged when there is movement of goods from one state to another state. The revenue will be collected by the central government and accordingly will be shared between the Union and states in the manner prescribed by Parliament or GST Council.
The above details would help candidates prepare for UPSC 2020.
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Multiple Choice Question
Consider the following statements
- GST was first recommended by the Kelkar committee task force.The first attempt to pass GST was made in 2011 by introducing the Constitution (115th Amendment) Bill in the Lok Sabha, which lapsed due to dissolution of 15th Lok Sabha.
- The power to make any changes in the GST law is in the hands of GST Council. The GST Council is headed by the Finance Minister. One hundred and first amendment act, 2016 introduced the GST in India from July 2017.
- The reform of India’s indirect tax regime was started in 1986 by Vishwanath Pratap Singh, Finance Minister in Rajiv Gandhi’s government, with the introduction of the Modified Value Added Tax (MODVAT). Subsequently, Prime Minister P V Narasimha Rao and his Finance Minister Manmohan Singh, initiated early discussions on a Value Added Tax (VAT) at the state level.
- The purpose of HSN codes is to make GST systematic and globally accepted.
HSN codes will remove the need to upload the detailed description of the goods.This will save time and make filing easier since GST returns are automated.
Choose the correct answer from the below-given options
A) None of the above statements are true.
B) Only statements 2, 3, and 4 are true.
C) Only statements 1, 3, and 4 are true.
D) All the above statements are true.