What is Goods & Services Tax (GST) ?
The Goods and Service Tax is an indirect tax which is applicable on the supply of goods and services. Under GST Regime, the goods and services are now taxed under a single law governed by the Goods and Service Tax Laws.
The GST regime mandates that all businesses involved in supplying of goods or providing services or both are required to register and obtain GST number. The law mandates compulsory registration based on certain turnover criteria.
There are three taxes applicable under this system: CGST, SGST & IGST.
CGST: Tax collected by the Central Government on an intra-state sale (e.g., a transaction happening within West Bengal)
SGST: Tax collected by the State Government on an intra-state sale (e.g., a transaction happening within West Bengal)
IGST: Tax collected by the Central Government for an inter-state sale (e.g., West Bengal to Bihar)
COMPOSITION SCHEME
GST can be paid under Composition Scheme. This would be available only to certain eligible taxable persons, if the aggregate turnover is upto 1.5 crore in the preeeceding financial year (75 lakhs in Special category states). The tax rates for goods are 1% for manufacturers and traders, 5% for restaurant and catering services. The tax rate for services is 6%, provided the aggregate turnover in the financial year does not exceed 50 lakhs.
VOLUNTARY REGISTRATION
GST registeration can be done Voluntarily also. In case of persons seeking voluntary registration, all provisions of registration shall be applicable to him/her.