Gst N Dtc

Implications of GST & DTC in Indian economy

GST-“TAX REPLACING TAXES”

We often observe difference in prices of same goods at different places.Example is petrol,there is difference in prices of petrol in every state by a rupee or two,although the country & government deciding the prices is common to all but the difference lies.A solution to this problem is goods and services tax. Goods and Service Tax is a tax on goods and services, which is leviable at each point of sale or provision of service, in which at the time of sale of goods or providing the services the seller or service provider can claim the input credit of tax which he has paid while purchasing the goods or procuring the service. On most of the goods and services the rate of tax remains the same but as per the necessity of the nation some goods or services can be declared as “exempted” or “Zero rated”. The whole system is developed in such a way that it avoids the cascading effect and the final consumer bears the burden of all the tax. Generally, in such a system Exports are zero rated and all the taxes paid while purchasing and manufacturing the goods including the taxes paid on raw material and services are returned to the exporter to make the exports competitive. The sellers or service providers collect the tax from their customer, who may or may not be the ultimate customer, and before depositing the same to the exchequer, they deduct the tax they have already paid.

. There could be renewed momentum in pushing through the much-delayed Goods and Services tax (GST) proposal in the coming days. The Parliamentary Standing Committee on Finance that is currently vetting the Constitutional (Amendment) Bill is expected to commence discussions on the bill in near future. I am hopeful that the Constitutional (Amendment) Bill will be passed by Parliament by April 1, 2013. However, the actual implementation of the GST will take much longer as it involves a lot of issues like preparing...