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Taxable Taxable
Taxable Event Taxable Event is Taxable Event is
Event is Event is Entertainment &
is Manufacture Import &
Provision Sale Entry of Goods
of Service Export
Proposed Indirect Tax Structure
Intra State Excise and Local VAT &
Service Tax will Other taxes will
Taxable be known as be known as
Supply CGST SGST
Key Challenges
- GST rate structure, Calculation of revenue base and the compensation, List of exemptions,
Consensus on GST Law, Consensus on Threshold limit, Administrative control over Scrutiny
cases by Centre and State.
Features of Proposed GST
Destination based Taxation
Apply to all taxable supplies of goods or services (as against manufacture, sale or provision of service) made for a
consideration except
o Exempted goods or services common list for CGST & SGST
o Goods or services outside the purview of GST
o Transactions below threshold limits
IGST (Integrated GST) on inter-State supplies of goods or services in India levied and collected by the Centre.
IGST applicable to
o Import of goods and services
o Inter-state stock transfers of goods and services
SGST@ 10% 10 Input Credit SGST -10 Input Credit SGST -11
Cost of Sales 100 Cost of Sales 110
Sale Price to Wholesaler 120
Add profit @ 10% 10 Add profit @ 10% 11
Total cost of sales 110 Total cost of sales 121
Add CGST@10% 11 Add CGST@10% 12
Add SGST@ 10% 11
Add SGST@ 10% 12
Tax collected by the Govt. 20
Sale price to retailer 132 Sale price to retailer 145
SGST@ 10% 10 Input Credit SGST -10 Input Credit SGST -11
Cost of Sales 100 Cost of Sales 110
Sale Price to Wholesaler 120
Add profit @ 10% 10 Add profit @ 10% 11
Total cost of sales 110 Total cost of sales 121
Add CGST@10% 11 Add CGST@10% 12
Add SGST@ 10% 11
Add SGST@ 10% 12
Tax collected by the Govt. 20
Sale price to retailer 132 Sale price to retailer 145
Registration has to be done in the State from where taxable goods or services
are supplied.
Taxable event
The taxable event under GST regime will be
supply of goods or services.
Meaning of Supply
Section 3 of the Goods and Services Tax, 2016 Act says
that supply shall include-
(1)(a):all forms of supply of goods and/or services such as
sale, transfer, barter, exchange, license, rental, lease or
disposal made or agreed to be made for a consideration by
a person in the course or furtherance of business;
importation of service, whether or not for a
consideration and whether or not in the course of
furtherance of business, and
a supply specified in Schedule -I made or agreed to be
made without consideration.
Point of taxation
Central & State GST will be payable on the happening of
the following events:-
[i] Where the goods are movable, the date on which the
goods are removed for supply to the recipient;
[ii] In the case of immovable properties, it will be the date on
which the goods are made available to the concerned person;
[iii] Date of issue of invoice by the supplier;
[iv] When payment is given to the supplier;
[vi] Date when the receipt of goods is acknowledged by book
entries by the recipient.
TCS online sale of goods of services
Every e-commerce operator engaged in
facilitating the supply of any goods and/or
services (like Amazon, Flipkart, etc.) shall
collect tax at source at the time of credit or at
the time of payment, whichever is earlier.