GST is one of the biggest tax reforms introduced in the history of Indian tax reforms which is aimed to help in the growth of the economy. We provide comprehensive advice and assistance on GST which includes ,
- Review contracts and agreements in order to identify the GST impact, from the perspective of Procurement, Manufacturing and Distribution
- Assistance in identifying optimal valuation model for related party transactions under GST, while aligning the same with the model adopted under transfer pricing provisions
- Evaluate the legal positions adopted and suggest changes, if any, under the GST regime
- Assistance to comply with the provisions of anti-profiteering rules under GST.
1. What is GST?
The Goods and Services Tax (GST) is a tax on the supply of goods and services. It is essentially a tax on the value addition at each stage and a supplier at each stage is permitted to claim set-off, through an input tax credit mechanism i.e. the tax paid on the purchase of goods and services is available for set-off against the tax to be paid on further supply of goods and services. The Act, Rules and the rate of GST across all Indian states including union territories are uniforms.
2. Which goods/sectors are out of the purview of GST?
Goods/sectors that are out of the GST ambit include alcohol and specified petroleum products i.e. petroleum crude, high-speed diesel, motor spirit, aviation turbine fuel and natural gas. Petroleum products are likely to be inducted into GST at a later date. Alcohol for human consumption continues to attract state excise duty and VAT. Tobacco and tobacco-based products attract both excise duty and GST. Taxes such as stamp duty, toll tax, road tax, electricity duty, etc. are not part of GST.
3. What is the current rate structure under GST?
The rate structure consists of four slabs i.e. 5, 12, 18 and 28 percent, GSTcompensation cess on selected goods besides goods which are taxed at nil rate (fully exempt). GST tariff should be referred to, to know the tax rate for respective goods and services..