The GST Tax is a single tax that has replaced all other indirect tax forms in India.
The Goods and Service Tax simply referred to as the GST in India, is a uniform, indirect tax introduced by the Government of India in March 2017. It came into effect on July 1, 2017. The GST was introduced to replace most other indirect taxes in India, such as the VAT, service tax, excise duty, and so on.
The Government of India levies the GST tax on the supply of all kinds of products you can purchase and services you can avail of in the Indian public and private domains. It is essentially a multi-stage, comprehensive, destination-based tax levied on value-added services.
With the introduction of the Goods & Service Tax, the Government of India replaced the previous indirect tax regime and introduced a single tax. Under GST, every state follows the same tax rate for a particular product purchased or service availed. The tax rate is determined by the Central Government and helps make the tax administration easy. Now, instead of paying taxes at multiple stages in the supply chain, Indian taxpayers can pay a one-time GST at the end of the supply chain.
The Goods & Service Tax comprises of three taxes now subsumed or absorbed by the Government under one umbrella. These include:
With the new regime of GST, the Centre and States share the revenue equally on sales with the state. As for inter-state sales, the Government now levies only one type of tax, the central tax. The Centre then shares the IGST revenue, depending on the destination of goods.
You will receive a confirmation SMS alert, and you can also check your account statement. You may refer to the transaction reference or UTR to track and update your payments. Also, ensure that you verify if the GSTIN payment details are correct. Note that you will also receive an email stating that the Goods and Service Tax has been paid on your registered email id, while the deposit status of Challan on the GST website will be updated as paid. You may now download the tax payment receipt from the GST website.
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The GST rate levied depends on the type of service purchased. The basic tax rate is anywhere from 5- 12 per cent, whereas the tax on luxury purchases and leisure services can be in the 18- 28 per cent range.
The Goods and Service Tax is a game-changer in that it has led to the creation of a uniform indirect tax payment channel. Besides bringing uniformity to indirect tax payment, the GST has also helped the Government curb tax evasion on the part of taxpayers, increasing the taxpayer base and improving the logistics and distribution systems in the country.
GST has helped remove the cascading effect of multiple taxes at different stages in the supply chain. It has redefined the treatment of e-commerce activities in India and helped regulate the unorganised sectors.