Goods and Services Tax (GST) is a comprehensive indirect tax levied on the supply of goods or services or both in India. GST was effected and implemented to the whole of India from 01.07.2017. Due special status of Jammu and Kashmir under article 370 of Indian Constitution GST was implemented on July 8, 2017.
Intra-State supply refers to any supply of goods or services within a particular state or union territory. When an intra-state supply takes place, the tax liability is divided into two components: Central Goods and Services Tax (CGST) and State Goods and Services Tax (SGST) or Union Territory Goods and Services Tax (UTGST). The Area up to 12 nautical miles inside the sea is a contiguous zone of the respective state or union territory as per the Territorial Waters, Continental Shelf, Exclusive Economic Zone, and Other Maritime Zones Act, 1976.
X from Cochin, Kerala sells 1000 sarees at the rate of Rs.300/- per saree to the purchaser Y who is in Calicut, Kerala. The GST rate is 5 percent. Here the supply of goods occurs within the State of Kerala.
The above illustration is an Intra-state supply, in the invoice the GST will be mentioned as follows
| Item | Description | Unit Price (Rs.) | GST (%) | CGST (%) | SGST (%) | Quantity | Calculation | Amount (Rs) |
|---|---|---|---|---|---|---|---|---|
| Saree | Silk Saree | 300 | 1000 | 300*1000 | 3,00,000 | |||
| GST Rate | 5 | |||||||
| CGST Rate | 2.5 | (3,00,000*2.5)/100 | 7,500 | |||||
| SGST Rate | 2.5 | (3,00,000*2.5)/100 | 7,500 | |||||
| Total Amount with GST | 3,15,000 | |||||||
X will not have any Input Tax Credit (ITC), Central Government will get Rs.7,500 as GST, State Government will get Rs.7,500, X will remit these taxes through Internet Banking.
Inter-State supply refers to any supply of goods or services from one to State/Union Territory to another State/Union Territory. Under inter-state supply the tax liability is not divided into two components for State and Central. Instead Integrated Goods and Services Tax (IGST) is payable to Central Government. IGST is applicable to the Area beyond 12 nautical miles to 200 nautical miles inside sea as per the Territorial Waters, Continental Shelf, Exclusive Economic Zone, and Other Maritime Zones Act, 1976.
X from Bangalore, Karnataka sells 1000 sarees at the rate of Rs.300/- per saree to the purchaser Y who is in Calicut, Kerala. The IGST rate is 5 percent. Here the supply of goods occurs between the States of Karnataka and Kerala
The above illustration is an Inter-state supply, in the invoice the IGST will be mentioned as follows
| Item | Description | Unit Price (Rs.) | GST (%) | IGST (%) | Quantity | Calculation | Amount (Rs) |
|---|---|---|---|---|---|---|---|
| Saree | Silk Saree | 300 | 1000 | 300*1000 | 3,00,000 | ||
| GST Rate | 5 | ||||||
| IGST Rate | 5 | (3,00,000*5)/100 | 15,000 | ||||
| Total Amount with GST | 3,15,000 | ||||||
X will remit the Input Tax Credit (ITC) to Central Government Rs.15,000 as GST, through Internet Banking.
THe provision of the State Goods and Services Tax Act are all identical to provisions of the Central Goods and Services Tax Act
Union Territory GST (UTGST) Act has passed for union territories which do not have legislature.
Union Territories of Andaman and Nicobar Islands, Dadra and Nagar Haveli, Chandigarh, Lakshadweep, Daman and Diu does not have legislature. For these union territories, the UTGST act is applicable.
Although Pondicherry and Delhi are union territories they have legislature, so they passed their own SGST act.
Taxable person needs to have GST Registration for each State separately. GST is applicable for the supply of Goods and Services between the taxable persons having two distinct GST registration.
For example, GST is applicable for the transfer of Goods or services provided by the Tamilnadu Branch of a company to the Kerala Branch of that same company.
In general, consideration for the supply of goods or services is need not to be in form cash and it can be of any kind in nature. When the consideration is nil, GST is not applicable. The taxable person provides a supply of goods or service to a related person is subject to GST, even if consideration is nil.
For example, In Gst, taxable persons, Employee and Employer are treated as related persons. In this case, the company gifts an asset (provides a supply of goods) to employee not covered under the employment agreement is subject to GST. The value of the gift is up to Rs.50,000/- then GST is not applicable.
For unrelated persons GST is not applicable, but the input tax credit will have to be reversed.
Goods and Service Tax (GST) Council established under Article 279A of Indian Constitution, shall make recommendations to the Union and the States.
The Aggregate turnover means the value of
However aggregate turnover does not include
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