What is GST Framework?

20/Aug/2020
What Is GST Framework

What is GST Framework?

GST framework is a design made by the Indian Government that would eliminate most of the indirect taxes like VAT, customs duty, excise duty, CST, service tax, entertainment tax and bring it all under a single tax structure called GST.

GST will be mainly of 2 forms viz. intra-state level and inter-state level. The former encircles CGST and SGST whereas the latter encircles IGST and imports. Additionally, exports and supplies to SEZ are zero-rated as per the GST framework.

Concept of GST

Goods & Services Tax (GST) is an indirect tax applied on goods and services. Its genesis happened in the historic budget speech of February 28, 2006. GST has changed the way business is conducted and how goods and services are taxed in India. GST has made deep impacts in India’s economic environment. In this article, we intend to share some GST knowledge and all about GST through different GST sections. Let us read through the GST basics and GST framework in this session…

To Whom All is GST Applied to?

  • Supplier of goods and/or services of value exceeding Rs.20 lakh in a FY
  • Supplier of goods and/or services that are inert-state taxable
  • All E-commerce operators and everyone who sells goods and/or services through E-commerce platforms (other than branded items)
  • Aggregators selling items under own brand names
  • Ordinary Taxable person
  • Non-resident taxable person
  • A person who deduct/collect tax
  • Person taxable under Reverse Charge mechanism
  • The person outside India who supplies online information, data access or retrieval services to a person in India who does not fall under the category of a registered taxable person
  • Input Service Distributor
  • A person who on behalf of another taxable person supplying goods

The GST Framework

GST Framework contains the following components:

Dual GST:

India has a unique federal structure that is incorporated with the Dual GST model. Dual GST is the tax imposed by the centre and state on goods or services or both in intra-state or Union Territories.

GST is a destination-based tax applied on all transactions involving supply of goods and services. GST is comprised of:

  1. Central Goods & Services Tax: This GST Basic Tax is collected by Central Government
  2. State Goods & Services Tax (SGST): A collection of GST Basic tax amount by State Government or Union Territories with State Legislatures
  3. Union Territory Goods & Services Tax (UTGST): GST Basic tax collected by UTs without State legislatures on intra-state goods and/or services.
  4. Integrated Goods & Services Tax (IGST) is the basic GST tax which is the sum total of CGST and SGST/UTGST levied by central government on all inter-state supplies.

The Legislative Part of GST Framework

GST Framework has a legislative part on par with CGST Act 2017 for levying CGST. Similarly, the UTGST Act 2017 governs Union Territories without State Legislatures. Andaman & Nicobar Islands, Lakshadweep, Dadra & Nagar Haveli, Daman & Diu and Chandigarh are the UTs without State Legislatures. Delhi & Puducherry have their own legislatures and hence their own SGST levying policies. The principle of dual GST and SGST legislations are preserved through absolute management of,

  • Chargeability
  • Definition of taxable person & event
  • Assessment of goods & services
  • The procedural approach of tax collection and tax levy

Goods & Services Classification

While determining GST on product or service, the item will be subjected to an internationally adopted scheme for commodity description and product taxonomy. According to this system, goods and services in India are classified into two divisions called Harmonized System Nomenclature (HSN) for goods and Service Accounting Code (SAC) for services.
GST knowledge is incomplete if you don’t know all about GST’s rules applied on classification of goods and services coming under.

All about GST classification of other products:

 

Read more on:  

Types of GST - CGST, SGST and IGST

What is GST Return?

 

Other Blogs

Seven Major changes in Income Tax Rules, in effect from September 1, 2019.

Government has introduced 7 new changes in the Incone Tax Laws that has come into effect from September 1, 2019

12/Sep/2019

SoP for Filing Kerala Flood Cess Return and payment

For filing return and payment of Kerala Flood Cess, every taxpayer has to register into the Kerala Flood Cess Portal available on the website of Kerala State Goods and Services Tax Department.

20/Sep/2019

Thirty seventh GST Council Meeting - Key Highlights

The 37th GST council has been held in Panaji on September 20, 2019.The meeting wrapped up with several decisions ranging from relaxations in annual return filing, rate revisions, deferment of new GST

27/Sep/2019

State Government to Levy Kerala Flood Cess

Kerala is still in the path of repossession after the trauma it got from the floods last year.

14/Jun/2019

How to Calculate Kerala Flood Cess ?

The government of Kerala has been given the green flag for levying 1% Kerala Flood Cess on goods and services.

17/Jun/2019

Highlights of Union Budget 2019

Check out the highligts of India Union Budget 2019 presented by Finance Minister Nirmala Sitharaman

24/Jul/2019

Central Government issues yet another amendment on Kerala Flood Cess

The latest amendment that is merged in Kerala Flood Cess is described below.

05/Aug/2019

What is GST?

The Goods and Service Tax (GST) is an indirect/consumption tax levied on the supply of goods. Currently, GST is divided into 5 tax slabs for collection of tax- 0%, 5%, 12%, 18% and 28%.The Goods & Service Tax came into effect on July 1, 2017 as per the 101st Amendment of the Constitution of India by the Indian Government.

05/Aug/2019

GST to Hire E-invoicing

E-invoicing is simply a form of electronic billing and it allows easy monitoring of transaction documents.

16/Aug/2019

GSTN Releases the New Return Prototype

GSTN has come up with a web-based prototype which is an interactive demo version of the "Offline Tools Of New Return"

20/Aug/2019

GSTR 9 : Annual Return Filing, Eligibility, Format & Rules

Last date to file GSTR-9 is 30 November 2019.GSTR-9 is an annual return to be filed once in a year by the registered taxpayers under GST.

02/Sep/2019

E-invoices replace GST Invoices: E-Invoicing Benefits, Implementation and How does it works?

E-invoicing is the electronic format of an already generated standard invoice. It facilitates the automation of multi-purpose reporting through one-time input of invoice details.

24/Oct/2019

Home Loan Benefits - Income Tax Deductions and Tax exemption on Housing Loan.

Details about the Tax benefit on Housing loan,Tax rebate on Home loan, Home loan interest deduction. Know more about Income tax exemption and home loan income tax benefit.

31/Oct/2019

What is Input Tax Credit under GST - How to Claim and Calculate it?

Input Tax Credit(ITC) reduces taxes paid on inputs from taxes that are to be paid on output. Input Credit Mechanism is available to you when you are covered under the GST Act.

08/Nov/2019

New Simplified GST Return Forms - Sahaj & Sugam

Sahaj & Sugam new GST Return Forms where announced by GST Council to ease the filing for registered GST taxpayers.

20/Nov/2019

Income Tax System In India - Complete Guide, Types, Rules, IT Returns, Slabs, e Filing

Income Tax is a tax you pay directly to the government based on your income or profit. Learn more about Income Tax slabs, filing process, deductions, refund, rules, calculations, TDS,Income Tax return

05/Dec/2019

Working of E-Invoicing under GST

E-invoicing, new GST invoicing format is starting from 1st January 2020 on voluntary basis.In this system GST network will generate a unique invoice number, also called unique Invoice Reference Number

12/Dec/2019

What if You DON'T file your Returns by December 31, 2019?

The final date for Income Tax Return filing is December 31, 2019. Every person whose total income in the FY 2019 exceeds Rs.2.5lakh are liable to file ITR.

19/Dec/2019

Key Highlights of 38th GST Council Meeting - 28% Tax on Lotteries- GSTR 9 & 9C Deadlines Extended.

Highlights of GST Council Meet - due date for GSTR-9 and GSTR-9C for the FY 2017-18 has been extended and 28% Tax on all lotteries. Find more updates from the 38th GST Council Meeting.

30/Dec/2019

What is Pre-budget Memorandum?

What is Pre-budget Memorandum? Who created Pre-budget Memorandum? Major suggestions in 2020 Pre-budget Memorandum.

13/Jan/2020

GST Revenue Collection

The GST collection has crossed 1 Lakh Cr for the second consecutive month. This indicates that the consumption has boosted despite all the initial chaos about GST.

23/Jan/2020

What is Reverse Charge Mechanism?

Reverse Charge Mechanism(RCM) in GST means that the receiver of the goods or services is liable to pay the tax and not the supplier.

28/Jan/2020

What is the income tax slab for FY 2020 - 21?

Find out the new Income Tax slab tax rates in India for FY 2020-21

11/Feb/2020

Employee State Insurance (ESI) - Here is what you should know...

This article familiarizes you about Employee State Insurance (ESI) Scheme and its eligibility, applicability and benefits for employees.

21/Feb/2020

Everything about GST Composition Scheme

Is GST Composition Scheme beneficial? Have a look on GST Composition Scheme in detail with its benefits, conditions, tax rates etc.

21/Feb/2020

39th GST Council Meeting

The 39th GST Council Meeting has been held on March 14, 2020 at New Delhi. Here's all you need to know.

19/Mar/2020

IGST: What to Know & Its Overview

GST has many tax subsets alongside rules and sections to follow. What IGST is and what are the associated elements of it are illustrated here...

30/Mar/2020

ITR filing deadline for FY19 extended till 30 June 2020

Income Tax & GST Return Extended till June 30 owing to COVID-19 Outbreak!

07/Apr/2020

Corona Virus: Rs 1.7 lakh cr economic relief package announced by Finance Minister Nirmala Sitharaman

FM Sitharaman is announcing the most-awaited economic relief package amid the Covid-19 pandemic.

16/Apr/2020

Online Income Tax Challans

Income Tax Payment with Online Challans. Find about how to pay advance tax, self assessment tax online.

05/May/2020

A Complete Guide On Job Work Under GST India

The GST Act makes special provisions with regard to removal of goods for job-work and receiving back the goods after processing from the job-worker without the payment of GST.

08/May/2020

What is GST Return?

Complete guide about GST Returns - The different types of GST returns, who should file these returns and when to file GST returns. Read now

03/Jun/2020

What is RBI Moratorium?

The moratorium means that the borrowers would not have to pay the loan EMI installments during the moratorium period. Read to know more about the facts of RBI's moratorium.

25/Jun/2020

Highlights of 40th GST Council Meet

Highlights of 40th GST Council Meeting dated 12th June 2020.

30/Jun/2020

What is GST Demand & Recovery?

As per the provisions of recovery of tax in GST, if the amount payable by a taxable person, remains unpaid, even after 3 months from the date of issuing the order for demand of tax, then the recovery of tax under GST will be initiated.

04/Aug/2020

GST Return due dates

GST return due dates and interest related queries have been extended and solved respectively through the various circulars and notifications published by the government.

07/Aug/2020

Types of GST

The GST types are determined based on the province in which the goods and/or services are exchanged and transactions made. The types of GST include: • Central Goods & Services Tax (CGST) • State Goods & Services Tax (SGST) • Union Territory GST (UTGST) • Integrated GST (ITGST)

19/Aug/2020

GST Classification

GST classification is the diverse broad categories into which goods and services are categorized, taking into consideration certain specific set of factors.

21/Aug/2020

GST Registration

GST Registration is that part of the GST regime in which every business with turnover of Rs.40 Lakhs should register as a normal tax payer. The threshold turnover limit for GST registration for NE and hill states is Rs.10 lakh.

28/Aug/2020

What is GST Compensation Cess?

The GST Compensation Cess will compensate the states for any revenue loss incurred on implementing Goods & Service Tax (GST) on July 1, 2017 for a period of 5 years or as the GST council recommends

14/Oct/2020