What is GST in India meaning and full explanation

GST Goods and Service Tax is an indirect tax levied in India on the supply of goods and service also known as (consumption based tax). Goods and service tax GST replaced many Indirect Tax in India. Government rolled out GST on 1st July 2017. The introduction of goods and service tax GST is a very significant step in the field of indirect tax reform in India. By amalgamating a large number of Central and state taxes into a single tax, it will erase cascading effects in major way and paved the way for common national market.


What is GST
Rates of GST
Registration of GST 
Components of GST
How is GST applied 

What is GST 

GST is levied on 'supply' of Goods or Service or both, in India including the State of Jammu and Kashmir.

In a single tax on the supply of Goods and Services, right from the manufacturer to the consumer. Under GST credit of taxes paid at privious stage is available as set-off.

In a nutshell, only value addition will be taxed and burden of tax is to be borne by the final Consumer.

GST Law has been made applicable from 1st July 2017. GST is consumption based tax that takes occrues to the texting authority which has jurisdiction over the place of consumption which is also termed as place of supply.

Rate of GST

CGST, SGST / UTGST and IGST is levied at rates mutually agreed upon by the Central and the State under the aegis of the Goods and Service Tax Council. The Rate of GST are Nil, 0.5%, 3%, 5%, 12%, 18%, and 28%. In addition, GST Compensation Cess is payable on pan masala, tobacco product, coal, arerated water and motor cars. These rates applies to IGST also.

Download all GST Rates pdf

Registration of GST

Every supplier of goods and / or services required to obtain registration under GST in the State from where he makes the taxable supply if his aggregate turnover exceed rupees 20 lakh during a financial year.

However, the limit of rupees 20 lakh will be reduced to 10 lakh, if the person is carrying out business in Special Categories State except the State of Jammu and Kashmir [Special Category States are State of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh, and Uttarakhand.

For Easy GST Registration click here

Components of GST

(1) CGST / SGST : For supply within the state or union territory i. e. Inter-State-Supply

(a)  Central Goods and Service Tax (CGST) is payable to Central Government, and

(b)  State Goods and Service Tax (SGST) is payable to State Government

(c)  Union Territory Goods and Service Tax UTGST is payable to Union Territory (as applicable)

(2)  IGST : For supply from one state or Union Territory to another State or Union Territory i. e. inter-state supplies Integrated Goods and Service Tax (IGST) is payable to Central Government.

How is GST Applied

(1)  GST applies to all Goods and Service except alcohol for human consumption.

(2)  Electricity has been kept out of GST.

(3)  Tobacco and tobacco product are subject to GST in addition the central countries continuous to levy central excise furthermore.

(4)  GST on 5 specified petroleum product Crude, Petrol, Diesel, Aviation turbine fuel and Natural gas would be applicable from a date to be recommended by the goods and service tax Council.

What is GST in India meaning and full explanation What is GST in India meaning and full explanation Reviewed by Unknown on August 21, 2018 Rating: 5


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