What is GST and how does it work in India?

What is GST and how does it work in India?

GST acts as a type of value-added tax and a proposed comprehensive indirect tax levy on manufacture, sale, and consumption of goods as well as services at the national level. It will replace all indirect taxes levied on goods and services by the Indian central and state governments.

How GST payable is calculated?

The formula for GST calculation:

  • Add GST: GST Amount = (Original Cost x GST\%)/100. Net Price = Original Cost + GST Amount.
  • Remove GST: GST Amount = Original Cost – [Original Cost x {100/(100+GST\%)}] Net Price = Original Cost – GST Amount.

Who can pay GST?

2) Who is liable to pay GST? In general the supplier of goods or service is liable to pay GST. However in specified cases like imports and other notified supplies, the liability may be cast on the recipient under the reverse charge mechanism.

What is GST and how does it work?

Goods and Services Tax (GST): What It Is and How It Works. Goods and Services Tax or GST is a broad-based consumption tax levied on the import of goods (collected by Singapore Customs ), as well as nearly all supplies of goods and services in Singapore. In other countries, GST is known as the Value-Added Tax or VAT.

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What is a GST credit and how does it work?

The goods and services tax/harmonized sales tax (GST/HST) credit is a tax-free quarterly payment that helps individuals and families with low and modest incomes offset the GST or HST that they pay. It may also include payments from provincial and territorial programs. You are automatically considered for the GST/HST credit when you file your taxes.

How GST will help the consumers?

Decrease in the price of goods&services Since GST is charged at all levels of the supply chain,a considerable difference can be found in the prices of

  • Same price around the country One of the major advantages of GST is the fact that a consumer will be able to avail the product at the same price
  • Simplified tax system
  • What are the objectives of GST?

    The objectives of GST are as follows: TO ELIMINATE THE CASCADING EFFECT OF INDIRECT TAXES ON SINGLE TRANSACTION The basic objective of GST is to remove cascading effect of the taxes. Cascading effect of taxes mean levy of tax on tax.

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