Goods & Services Tax (GST) is an indirect tax, introduced following the passage of Constitution 122nd Amendment Bill, throughout India to replace all the existing taxes levied by the central and state governments. It is directly under the Union Finance Minister. GST is launching from 1st July 2017 midnight.
There will be three kinds of GST:
CGST: to be collected by central government
SGST: to be collected by state governments for intra-state sales
IGST: to be collected by central government for inter-state sales
· Transparent tax and reduces the number of indirect taxes.
· No hidden taxes and lowers the cost of doing business.
· Prices will come down as double taxation will not be playing a role.
· It will be levied only at the final destination based on VAT principle and not at various points.
It will help building a transparent and corruption free tax administration.
· Negative impact on real estate hiking up the cost of new homes by about 8%.
· Some retail products will see a hike in their prices especially clothing.
· Service taxes or airfare varies from 6%-9%. After GST it will be over 15%, almost double the present rates.
GST has been one heck of a hype-cum-trending topic for debate lately. The common man is wondering what would be its effect on the daily life. Whatever be the cause of action, its true conclusion could only be drawn after its implementation.