Goods and Services Tax (GST)

GST is a comprehensive Indirect Tax that has replaced many Indirect taxes

It came into effect on 1st July, 2017

Types of taxes levied under GST

There are 3 types of taxes levied under GST:\

1 Central GST (CGST) - It is levied on the 'intra-state' sale or purchase of goods and services

2 State GST (SGST) - It is levied on the 'intra-state' sale or purchase of goods and services

3 Integrated GST (IGST) - It is levied on the 'Inter-state' sale or purchase of goods and services

Some facts about GST

1 GST has replaced 17 indirect taxes like VAT, Sales Tax, Excise Duty etc.

2 With implementation of GST, luxury items have become costlier

while items of daily consumption have become cheaper

3 It is a 'Consumption Based Tax'

The tax is received by the state in which goods are consumed, and not the state in which goods are manfactured

Benefits of GST

1 Reduction in overall tax burden

2 No hidden taxes

3 Increased economic activity

4 Customer have a wider choice

5 More employment opportunities\

6 Higher disposable income in hand for education and essential needs

Key Features

1 GST is applicable throughout the country\

2 It is applicable on supply of goods and services, against the earlier concept of tax on manufacture/ sale of goods

and services

3 Import of goods is treated similar to 'Inter-state' transactions.

So, IGST is applicable in this case

4 GST has 5 tax slab rate: 0%, 5%, 12%, 18%, 28%

MCQ Other Books

Q1

In the following questions, select the correct answers:

1 All Indirect Taxes have been subsumed under:

A Income Tax

B Corporate Tax

C Goods and Services Tax (GST)

D Value Added Tax (VAT)

Q2

2 Which of these is not a slab rate of GST?

A 5%\

B 18%

C 22%

D 28%

Q3

In case of imported goods:

A they are treated as 'Intra-state' transaction and SGST and CGST are levied

B they are treated as 'Inter-state' transaction and IGST is levied

C Sales Tax is levied on them

D No Tax is levied