GST is a comprehensive indirect tax on manufacture, sale and consumption of goods and services throughout India, amalgamating a large number of Central and State taxes into a single tax. Introduction of Goods and Services Tax (GST) signifies a major step in the field of indirect tax reforms in India.
What are the benefits of GST?
For goods and services providers, GST paves the way for a common national market and hence would make Indian products competitive in the domestic and international markets. For consumers, GST signifies a simpler tax system designed to promote uniform prices throughout the country. For authorities it is easier to administer because of it transparent and has a self-policing character.
Note, besides, that it is no more immoral to directly rob citizens than to slip indirect taxes into the price of goods that they cannot do without.
~ Albert Camus
What taxes will be replaced by GST?
GST would replace the following taxes currently levied and collected by the Centre:
Central Excise Duty
Duties of Excise (Medicinal and Toilet Preparations)
Additional Duties of Excise (Goods of Special Importance)
Additional Duties of Excise (Textiles and Textile Products)
Additional Duties of Customs (commonly known as CVD)
Special Additional Duty of Customs (SAD)
Cesses and surcharges insofar as they relate to supply of goods or services
State taxes that would be subsumed within the GST are:
Central Sales Tax
Entry Tax (All forms)
Entertainment Tax (except those levied by the local bodies)
Taxes on advertisements
Taxes on lotteries, betting and gambling
State cesses and surcharges insofar as they relate to supply of goods or services