GST was meant to create a “single nation and single tax”, however, it has ended up on creating approximately six tax rates apart from the fact that much items are still left with the responsibility of State and Centre. Petroleum and alcohol including all other similar items that have a contribution of approximately 40 percent in the state revenue are out of the concept of GST. The GST has led to a complete change in the financial structure of India with respect to the matters of Tax Collection in our country.
Need to know the difference between the current tax collection framework and the new GST taxation in India? Well, for that there is a need to recognize what precisely GST is about. GST has been introduced with an intention to bring consistency in the market arrangement of our country. This will lead to a reduction in the import and export taxes, thus, lessening the burden of the tax payer.
There is no need for a business incurring an income of fewer than 20 lakhs to register in GST. It is quite transparent and answerable. The tax payer will be facilitated by getting the information on what all taxes he is paying.
The existing Taxation System in our country is full of complications. GST is here to remove all these complications and make the Taxation System easier by replacing all the indirect taxes and bringing a common market. Nowadays, a tax on tax is imposed, but with the imposing of GST, this will become much lesser and easier.
On discussing the differences between the condition of taxation WITH NO GST and the condition of the taxation WITH GST, following points can be formulated:
Normally, as the system says, VAT tax is levied on goods and Service tax is levied on Services. Here, the GST is playing a vital role by combining both the taxes and forming a COMMON TAXATION SYSTEM making it easier.
Earlier, it happened that you have to pay taxes on goods as well as on the service offered. But the introduction of GST has truly changed the scene. Now you have to pay the taxes collectively without paying separately for the service offered.
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A sigh of Relief for the importers and exporters
During the time of transportation of goods from state to state, the tax rates reach heights. The taxes are highly rated due to the involvement various VAT and Service taxes adding on the various state taxes, the rates become the highest from the higher. This is a problem for the importers and exporters. With GST coming in the picture, there will be no separate taxes on goods and services and state borders which will be quite feasible for the importers and exporters.
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GST tax will have a major Impact on the Taxation System of our country-
Having a transparent Tax system will lead to decrease the chances of corruption.
It will act as a support to the smaller organizations which have an income of fewer than 20 lakhs, as it won’t collect taxes from these companies according to the GST Rule.
SMEs will be highly attracted and affected by the GST, thus they are having a wider base in the GST model.
No need for any poor state to pay any extra tax. They will pay the equal amount of taxes that will help them to develop.
The three accounts that will be maintained under GST Taxation System are CGST, SGST, and IGST.
The new market formed will be free from any complications and easier. This is because, there will be no different separate taxes, a common system of taxpaying will be followed.