Question

Q. With reference to Goods and Service tax (GST), consider the following statements:

Which of the above given is/are correct?

• A.
  1 only
• B.
  2 and 3 only
• C.
  3 only
• D.
  1, 2 and 3

Answer 1

The correct option is D

1, 2 and 3
Explanation:

Statement 1 is correct: GST was first recommended by the LK Jha Committee in 1976.The L K Jha Committee on Indirect Tax Reform in 1976, which recommended the transforming of Union excise duties into a modified value added tax (MODVAT) by converting specific rates into ad valorem, unifying the rates and providing input tax credit.

Statement 2 is correct: Under the new GST regime the state cannot impose Surcharges and cess since it is subsumed under the GST.

Statement 3 is correct: GST is a destination-based tax as against the previous concept of origin-based tax.i.e., the goods/services will be taxed at the place where they are consumed and not at the origin. So, the state where they are consumed will have the right to collect GST.