DEMYSTIFYING SUPPLY AS PER REVISED MODEL GST LAW

DEMYSTIFYING SUPPLY AS PER REVISED MODEL GST LAW

By CA. Chitresh Gupta Managing Partner- Chitresh Gupta & Associates Article 366(12A) of the Constitutional (101st Amendment) Act, 2016 defines the Goods and Services tax (GST) as “a tax on supply of goods or services or both, except supply of alcoholic liquor for human consumption”. The term ‘supply’ is, however, not defined in the Constitution. The concept of ‘supply’ is the key stone of the proposed GST architecture. In other words, supply is life blood of GST regime. GST is a multi-stage tax levied on supply of goods and / or services, collected at each stage of the production and distribution, in proportion to the value added by each taxable person in the chain of supply. In the GST regime, the entire value of supply of goods and / or services is proposed to be taxed in an integrated manner, unlike the existing indirect taxes, which are charged independently either on the manufacture or sale of goods, or on the provisions of services. Section 3 of the Model CGST / SGST Act explains the meaning and scope of term “Supply”. Read...
Input Tax Credit under Revised Model GST Law 2016

Input Tax Credit under Revised Model GST Law 2016

INTRODUCTION In the present indirect taxation system, cascading of tax is significant due to non-availability of ITC at various stages. Following are certain instances of such cascading of taxes Permits restricted inter levy credits between Excise and Service Tax. No input tax credit of Central Sales Tax, Entry Tax, Octroi and Luxury Tax,; Input tax credit of VAT is not available to manufacturers and service providers; Input tax credit of Central Excise duty, service tax & CVD is not admissible to dealers in goods; No input tax credit of Swachh Bharat Cess available and No Cenvat credit of Krishi Kalyan Cess to manufacturers One of the basic tenets of proposed GST regime is seamless flow of input tax credit across the value chain right from manufacturer to the final consumer. This will result in equitable distribution and efficient allocation of economic resources. Under GST law, ITC will follow supply chain not only in intra-State transactions but also in inter-State transactions. Further, credit of tax paid at the time of import of goods and services would also be creditable. This is expected to result into significant reduction in cascading of taxes. Read...
All About Job Work in GST Regime

All About Job Work in GST Regime

By CA. Chitresh Gupta B. Com(H), FCA, IFRS (Certified), IDT (Certified) Movement of goods to job workers is an essential business situation which occurs frequently. Many times a manufacturer send goods to a job worker for getting further work done on them, and receive the goods back from job worker or sell the goods directly from the place of job worker. The tax position along with this movement of goods needs specific attention because the availability of input tax credit depends on usage of goods in the manufacture of final product, and once goods are removed from the factory, it is significant to ensure that these goods either come back to the factory of manufacturer or otherwise are incorporated in the final goods sold by the manufacturer. In the existing regime, the value addition by the job worker is either taxable as manufacture or as taxable service, and in both cases, an exemption is granted to job worker in case, the principal manufacturer pays duty on the goods received after job work including the value addition. In GST regime, the same concept has been adopted more or less. 1. Concept of Job Work Section 2(61) of the Model CGST/SGST law provides that “job work” means undertaking any treatment or process by a person on goods belonging to another registered taxable person and the expression “job worker” shall be construed accordingly. READ...
FAQ ON GST ENROLMENT PROCESS AS PROVIDED BY GSTN AT www.gst.gov.in

FAQ ON GST ENROLMENT PROCESS AS PROVIDED BY GSTN AT www.gst.gov.in

Overview of Enrollment Who is an existing taxpayer? An existing taxpayer is an entity currently registered under any State or Central laws, like Value Added Tax Act, Central Excise Act and Service Tax Act. Existing taxpayers include taxpayers already registered under:- Central Excise Service Tax State Sales Tax or VAT (except exclusive liquor dealers if registered under VAT) Entry Tax Luxury Tax Entertainment Tax (except levied by the local bodies) What does the word ‘enrollment’ under the GST Common Portal mean? Enrollment under GST means validating the data of existing taxpayers and filling up the remaining key fields by the taxpayer in the Enrollment Application at the GST Common Portal. Do I need to enroll for GST? All existing taxpayers registered under any of the Acts as specified in Question 1 will be transitioned to GST. The enrollment for GST will ensure smooth transition to the GST regime. The data available with various tax authorities is incomplete and thus fresh enrollment has been planned. Also, this will ensure latest data of taxpayers is available in the GST database without any recourse to amendment process, which is the norm to update the data under tax statutes today. Why do I need to enrol myself as a taxpayer on the GST Common Portal? The GST Common Portal has been made available to enable taxpayers enrol with GST. Paper based enrolment option is NOT available. The GST Common Portal will enable taxpayers to meet the GST compliance requirement like filing return and making tax payment. Using the Portal requires existing taxpayers to enrol. Is there a concept of deemed enrollment under GST? No. There is no...
GST Helpline & Migration of ST/Excise Assessee by 31.01.2017

GST Helpline & Migration of ST/Excise Assessee by 31.01.2017

To ensure implementation of GST by 1st April, 2017, Central Board of Excise & Customs (CBEC) has initiated the process of migration of its existing Central Excise/Service Tax assessees to GST from today. A 24×7 Helpdesk (Through Toll Free number and Email) started for the purpose. Central Board of Excise & Customs (CBEC) has initiated the process of migration of its existing ENTRAL EXCISE/SERVICE TAX assessees to GST with effect from 9th January, 2017. As part of its efforts to ensure implementation of GST by 1st April, 2017, CBEC has taken steps to ensure that its existing taxpayers are migrated to GST in a simple, user-friendly and smooth manner. Once the existing registered Taxpayers (both Central Excise as well as Service Tax) login to CBEC’s Web Portal www.aces.gov.in, a facility will be given in a secure manner to access the provisional login ID and password given by Goods and Services Tax Network (GSTN). Thereafter, using the same, they can log in to GST Portal (www.gst.gov.in) to fill the required fields and submit scanned documents. However, if they have already initiated the process of migration to GST as a VAT asssessee under STATE COMMERCIAL TAX department, no further action is necessary. PAN is mandatory for migration to GST. Hence, if the existing Central Excise/Service Tax Registration Code does not have PAN, then PAN has to be obtained from Income Tax Department and the Registration details have to be updated in the ACES Portal www.aces.gov.in. CBEC has made available a 24×7 HELPDESK (TOLLFREE NO 18001200232, EMAIL:cbecmitra.helpdesk@icegate.gov.in) for the purpose of assisting existing CENTRAL EXCISE/SERVICE TAX assesses. GSTN also has a HELP...
PRESENTATION ON GST BY CBEC

PRESENTATION ON GST BY CBEC

PRESENTATION PLAN WHY GST : PERCEIVED BENEFITS EXISTING INDIRECT TAX STRUCTURE FEATURES OF CONSTITUTION AMENDMENT BILL FEATURES OF PROPOSED GST MODEL FEATURES OF DRAFT GST LAW GSTN ROLE OF CBEC WAY FORWARD                    READ...
FREQUENTLY ASKED QUESTIONS (FAQ) ON GST

FREQUENTLY ASKED QUESTIONS (FAQ) ON GST

Foreword With the 101st Constitution Amendment Act coming into force on 8th September, 2016 and notification of the GST Council on 15th September – the road to GST rollout is clear. Government is keen on introducing GST the biggest indirect tax reform, with effect from 01 April 2017. One of the biggest challenges is to train the indirect tax officials of both Centre and State, as well as the trade on the concepts, processes and procedures of GST. National Academy of Customs, Excise & Narcotics (NACEN), the apex training institution for capacity building in indirect taxation under the Central Board of Excise and Customs, has been mandated to impart training on GST to Central and State Government officers. NACEN is conducting a mammoth capacity building exercise to train about 60,000 indirect tax officers of the Centre and State so that officers are well equipped to implement GST when it is rolled out. NACEN has already created a team of almost 2000 trainers across the country to train the field officers.Considering the limited time available, NACEN apart from Classroom training, is also planning to use advanced information technology tools, such as Virtual Classrooms and E-Learning modules, to ensure larger coverage. As part of this capacity building exercise, the NACEN has prepared a compilation of Frequently Asked Questions (FAQ) based on inputs gathered while conducting training and interactive sessions, as a training tool for helping the officers as well as public, to get acquainted with the Model GST Law and its nuances. The FAQs have been prepared and reviewed by a team of officials from both Centre and States. I congratulate...
GST – CONCEPT & STATUS

GST – CONCEPT & STATUS

The introduction of Goods and Services Tax (GST) would be a very significant step in the field of indirect tax reforms in India. By amalgamating a large number of Central and State taxes into a single tax, it would mitigate cascading or double taxation in a major way and pave the way for a common national market. From the consumer point of view, the biggest advantage would be in terms of a reduction in the overall tax burden on goods, which is currently estimated at 25%-30%. Introduction of GST would also make Indian products competitive in the domestic and international markets. Studies show that this would instantly spur economic growth. Last but not the least, this tax, because of its transparent character, would be easier to administer.Genesis 2. The idea of moving towards the GST was first mooted by the then Union Finance Minister in his Budget for 2006-07. Initially, it was proposed that GST would be introduced from 1st April, 2010. The Empowered Committee of State Finance Ministers (EC) which had formulated the design of State VAT was requested to come up with a road-map and structure for the GST. Joint Working Groups of officials having representatives of the States as well as the Center were set up to examine various aspects of the GST and draw up reports specifically on exemptions and thresholds, taxation of services and taxation of inter-State supplies. Based on discussions within and between it and the Central Government, the EC released its First Discussion Paper (FDP) on the GST in November, 2009. This spells out the features of the proposed GST and has...
AMENDMENTS IN SERVICE TAX & CENVAT CREDIT RULES AS APPLICABLE  FROM 1ST APRIL,2016

AMENDMENTS IN SERVICE TAX & CENVAT CREDIT RULES AS APPLICABLE FROM 1ST APRIL,2016

  The Finance Minister has, while presenting the Union Budget 2016-17, introduced the Finance Bill, 2016 in the Lok Sabha on the 29th of February, 2016. Clauses 145 to 157 of the Bill cover the amendments made to Chapter V of the Finance Act, 1994. Changes are also proposed in,- Service Tax Rules, 1994 (STR) The Point of Taxation Rules, 2011; CENVAT Credit Rules, 2004(Cenvat Rules); It may be noted that changes being made in the Budget are coming into effect on various dates, as indicated below: Changes coming into effect immediately w.e.f. the 1st day of March, 2016; Changes coming into effect from the 1st day of April, 2016; Amendments which will get incorporated in the Finance Act, 1994 on enactment of the Finance Bill, 2016; Amendments made in the Finance Act, 1994, which will come into effect from 1st day of June, 2016 after the enactment of the Finance Bill, 2016; and Chapter VI of the Finance Bill, 2016, regarding levy of Krishi Kalyan Cess on all taxable services will come into effect from 1st June 2016. We present below the brief analysis of various Service Tax Amendments which are made applicable from 1st April,2016. S1: CHANGES IN MEGA EXEMPTION NOTIFICATION Notification  No. 25/2012-ST as amended by notification No. 09/2016-ST dated 1st March, 2016 refers  I. LEGAL SERVICES BY ADVOCATES Exemption in respect of the following services is being withdrawn,- Services provided by a senior advocate to an advocate or partnership firm of advocates A person represented on an arbitral tribunal to an arbitral tribunal; Thus Service tax in the above instances would be levied under forward charge....
Key highlights of Economic Survey Report 2016

Key highlights of Economic Survey Report 2016

Ahead of the Union Budget 2016, the Hon’ble Finance Minister Shri Arun Jaitley tabled today Economic Survey Report 2016 in the Parliament, outlining the broad direction of the Union Budget 2016 and the economic performance of the Country. A flagship annual document of the Ministry of Finance, Economic Survey reviews the developments in the Indian economy over the previous 12 months, summarizes the performance on major development programmes, and highlights the policy initiatives of the Government and the prospects of the economy in the short to medium term. Economic Survey 2016 termed external environment as challenging but projected a 7-7.5% GDP growth rate in the next fiscal which could accelerate to 8% in a couple of years. “One of the most critical short term challenges confronting the Indian economy is the twin balance sheet problem — the impaired financial positions of the public sector banks and some corporate houses. The twin balance sheet challenge is the major impediment to private investment and a full-fledged economic recovery,” the Survey said. The Economic Survey 2016 has also expressed concern over approval of Goods and Services Tax Bill being elusive so far. We are sharing with you the key highlights of the Economic Survey 2016: Economic Outlook, Prospects and Policy Challenges: With reforms in key areas, there is reduction in Macro-Vulnerability today Rates of 8% or Higher Expected in the next couple of years as there is Macro-Economic Stability now; India must plan for major currency readjustment in Asia; Expecting continued good performance by Industrial, Corporate & Infrastructure Sectors due to recent reforms; Indian equity market relatively resilient compared to other major emerging market economies;...