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India is eyeing upon its most ambitious tax reform on the coming month of July which is speculated to be similar like one it was seen in the independence era. The GST is said to eliminate all those cascading effects of taxes which was putting a heavier instance on every movement in the market.
One of the complex taxation structure Goods and Service Tax (GST) Regime will come into force from 1st July. Due to some complexities or problems in the new regime, the government itself is not confident enough how things will work out.
Today, market scenario combination of goods and services are supplied together to attract more consumer. In service tax, this is called bundled service and under GST law it can be classified as Composite supply and Mixed supply is entirely new concept introduced under GST law
The anti-profiteering clause of new indirect taxation structure seems like ineffective with no powers. The government has not framed restrict rules or regulations under this, in fact, suo moto will do more research on the anti-profiteering provision of GST Regime.
In the new indirect taxation regime prices of necessary drugs or medicines will go up by 2.29 percent when the GST implements from next month. Basic essential medicines are categorized under the 12 percent GST rates in new taxation regime and the GST rates were declared by the government in the GST Council Meeting. Under the current taxation, structure medicines are taxable at the rate of 9 percent.
Input tax credit in GST, As defined by section 2 (57) of the MGL (Model GST Law) and section 2 (1) (d) of the IGST Act, Input tax is related to a taxable entity which means the (IGST and CGST) in respect of CGST Act and (IGST and SGST) in respect of SGST Act is levied on every supply of goods or any services on the entity which is used by it or which is intended to to be consumed in the course of the business and subsumes the tax payable under sub-section (3) of section 7. In a simple way, input tax credit defines that an entity can reduce the taxes it paid on the inputs at the time of paying the taxes on output.
About three weeks left for the implementation of GST Regime in India and still the insurance industry is working effortlessly. The industry will not only require modifying their back-end systems but they will also require registering their offices across all the states in India.
Finally, GST council heard of many sectors which were requesting for some relief from the heavily loaded GST rates levied upon them.
The government is pressurizing to all the Members of Parliament and State legislatures to start spreading knowledge & awareness of Goods and Service Tax (GST) Regime across the country. Union Finance Minister Arun Jaitley has requested to all political parties to clearly understand the concept of new indirect taxation regime and also provide help or support to people, industries, businessmen whenever it is required. In a letter, Jaitley presents his views in the front of several political parties and said that he want their cooperation for the implementation of new GST Regime in India, which is going to implement from 1st July.
