The term GST refers to the phrase “good and Services Tax”.This Tax was introduced in India with the purpose to implement a single tax structure. Basically, it is one tax instead of all types of taxes on goods and services. Therefore a slogan becomes popular ‘one tax, one nation, one market ‘.It is expected to generate more tax revenue for the government through this. The other purpose to initiate this tax is to reduce tax evasion.
Contents in the Article
Structure of GST
Goods and services are categorized into different sections. Each section carries a different rate of tax. Below Tax rate as per categories of goods are mentioned;
- For Sanitary napkins, fortified milk, fresh fruits and vegetable tax rate is 0%.
- For coffee, tea, spices and electric vehicles tax rate is 5%.
- For butter, frozen meat products, ayurvedic medicines and spectacles tax rate is 12%.
- Pasta, pastries and cakes and detergents tax rate is 18%.
- Automobiles, dishwashers and vending machines’ tax rate is 28%.
Advantages of GST
- As it is a uniform tax and applicable across all the parts of a country therefore it makes the structure of tax simple. Instead of all indirect types of tax, a single tax imposed is called GST.
- Also, GST helps in tackling black money Basically it maintains transparency in business.
- GST also enhances the business for domestic producers because it is a uniform type of tax across the stages of a country.
- GST also increases the revenue for the government as there is a higher lucidity in business.
For in details information read: Advantages of GST
Disadvantages of GST
As every new system takes to implement properly. There could be a lot of chances to get problems while implementing that system and also many problems could be faced while it comes into existence. Similarly, GST also comprises some of the demerits which are mentioned below
GST is yet not imposed on all types of goods. It is not imposed on goods like Electricity, alcohol, petrol, and diesel.
Also, the GST rate is not finally settled on different types of goods and services Which generates uncertainty. This also produces hampers decision-making activities and also hampers investment in the production process