The Latest Amendment To The GST Rules And What It Will Mean For You
GST (Goods and Service Tax) is an Indirect Tax implemented in India on 1st July 2017. The Government of India had introduced the GST with the aim of replacing the Indirect Taxes in India; like service tax, vat etc. GST implementation was done for manufacturing and selling of goods and service all over India.
It is a destination-based tax levied at every stage of value addition. It has to be done carefully, keeping in mind the problem of double counting.
Gst amendment has a huge contribution to the way Indian tax reforms are taking place. GST was a big step bringing with it many advantages as well as disadvantages. The moto behind getting gst into operation was to simplify the tax sovereignty and make it organized and adequate.
It widens the taxation procedure making it more useful and streamlined for business-friendly growth and progress.
The latest amendment :
An alternative composition scheme was brought into undertaking for certain suppliers having an annual turnover of up to INR 50 lakhs. It demands a higher exemption ground through the specific request of the state and recommendation of the GST council. Taxes can now be paid quarterly, and returns can be filed yearly starting 1st April 2019.
Businessmen are advised to open their accounts to avail the benefits that the government offers. Online services help you get your personal gst number online. It is an easy and efficient service that government of India offers.
With all advantages, GST implementation also got in its disadvantages. Here are some points you should know.
Advantages of GST:
- Removes the cascading effect of tax:
Goods and service tax is a combination of various other taxes like; Service Tax, Central Excise, Luxury Tax, Sales Tax, etc. included all under one umbrella. It removes the concept of tax on tax. Gst implementation has streamlined the taxation procedure, making it business-friendly and easy to understand.
- Higher grounds for registration:
Earlier when the VAT structure was into being, any business with 50 lakhs or higher turnover was credible to pay the VAT, and VAT was varied from state to state. With the help of GST implementation, the threshold has increased to 20 lakhs protecting small businessmen from paying huge taxes.
- Benefits the small businesses and entrepreneurs:
Under GST, businesses with a turnover of Rs 20 to 75 lakh i.e. can get enormous benefits as it gives you the alternative to reduce the tax burden on the small businesses.
- Online facilities:
GST implementation is very susceptible, and the process online is also quite easy to access. Gst has been beneficial for start-ups and entrepreneurs online as for them; it will be no more be difficult to pay the taxes. It will also be very easy for them to work on start-ups and carry on a tax-free business.
- Defined treatments for e-commerce sites:
E-commerce sites have a huge advantage after the gst implementation. E-commerce sites earlier had to go through many formalities. The tax department had the power to seize goods if any of the documents were missing. The power they had caused a lot of problems for the e-commerce company. After GST implementation, it has all come to an end.
- Improved efficiency of logistics:
Before GST implementation logistics had to maintain huge warehouses across states to avoid inner state taxes, this led to wastage of space and thus reducing the operating cost of the company. After the new amendments, there has been a reduction in the unnecessary logistics costs, increasing profits for transportation companies.
Here are some major disadvantages of goods and service tax.
Disadvantages of GST:
- Increased costs due to advanced software:
With gst online, there has been a need for new software that has, in turn, increased the costs for a few small businesses. The software is currently available for free for SMEs, helping them grow with GST smoothly. It has reduced the effort of many.
- Online system:
Most businesses in India are not technologically friendly, and they might find it difficult to file their returns and make payments online. This is a major drawback of GST implementation, and it hampers the growth of many small industries.
- Implemented in the middle of the financial year:
As GST was implemented on the 1st of July 2017, industries followed the old tax structure for the first 3 months (April, May, and June), and GST for the rest of the financial year. Businesses may find it hard to adjust to the new taxation structure. It leads to a lot of confusion and misunderstandings at the beginning of the scheme.
Goods and services tax has been a major amendment in the Indian tax regime, done largely to obtain a streamlined taxation system confined to sale and purchase of goods and services. It has helped the small businesses immensely as well as the Indian economy. The latest GST amendments have helped India to grow and prosper financially, in turn, playing a major role to improve our GDP.