Thursday 31 July 2014

Developments in July 2014




Govt to resolve issues related to Goods and Services Tax roll-out within this year

Date : 1st August 2014
Finance Minister Arun Jaitley has said the government is aiming to resolve the issues hampering the roll out of Goods and Services Tax (GST) within this year.
"The government targets to find a solution in the course of this year and approve the legislative scheme which enables the introduction of GST," he said during Question Hour in Lok Sabha on Friday. Asserting that government is "willing to take a pragmatic view", Jaitley said it does not want a "token GST, but a substantial GST... There should be consensus (with states)".

He assured the House that no decision on GST introduction will be taken without consulting the states. Government has also assured states that it will compensate for any revenue loss incurred by them, from the date of introduction of GST, for a period of three years.

Referring to GST implementation, Jaitley said: "Time has come for pragmatic approach...one or two exceptions the government can consider. If too many taxes are excluded, the objectives of GST will not succeed...It (GST) is a good cause that everybody fall in line,"

The Finance Minister said various issues such as compensation to states, rate of taxation and possible exemptions are all on the drawing board. "States' concerns with regard to the GST mainly relate to loss of revenue, fiscal autonomy, compensation, keeping certain items out of GST, subsuming of certain taxes in GST etc," Jaitley said.
Certain states may face problems in initial stages of GST implementation. GST proposals would help in spurring growth and employment.

Source : Business Today, Economic Times


IT firms seek clarity on GST implementation

Date : 7th July 2014
Technology companies are looking for more clarity on implementation of GST, tax on software licences and thrust on developing infrastructure in small cities in the first budget of new government led by prime minister Narendra Modi.

Technology majors like Microsoft and BlackBerry, software services firms and industry bodies like Nasscom expect the Modi government to focus on leveraging ICT for economic growth and maximising the reach of policies.The government has already indicated boosting indigenous electronics manufacturing to check dependence on imports and has said that electronic manufacturing will be a priority.

Source : Times of India
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[Video] What is GST and how it will replace all Indirect taxes

This video by Amlan Dutta explains how GST will benefit all.


It's now very evident that Good's and service tax will hit India soon .Once set in , it will replace all Excise, service , CST , VAT, octroi, Local Body Tax.. just one GST will replace all indirect taxes

The good's and service tax (GST) is a excellent initiative but the states fear on losing revenue for example VAT , Octroi combine to the state revenue. VAT is nothing revenue for the state in terms of the sale happening in the state. So states have started fearing that they will be losing a lot of revenue in case such a centralized GST is implemented.

Basically the principle is that if the duty for a good ,say 100 Rs is fixed at 20 % , then center will collect 10 Rs and state will collect 10 Rs, however the state fears that it's collection's earlier in terms of VAT and octroi will be far compromised and so they are raising obstacles for the bill to pass.

As a common manufacturer , he will be subjected to less torture of facing 4 departments and filing 4 returns and can have a single place to file GST that's it. No more excise returns , no more sales returns , no more VAT returns - JUST 1 GST return.


Support GST to replace all indirect taxes, Support DTC (direct tax code ) to replace the complicated existing tax (direct )

National interest should come before self interest and so let us all join hands in welcoming good thing's that augur well for the economy. Don't fear what will happen to you. The world breed's on good change, just because we spend 15 years learning service tax , it doesn't mean that we should revolt against GST, rather good sense should prevail and we should welcome it.
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Wednesday 30 July 2014

Need For GST in India ???


WHY THERE IS NEED IN INDIA FOR GST
IMPLEMENTATION


The Goods and Services Tax (GST) is being looked upon as one the most important reform for
the country owing to its simplicity and revenue-worthiness. However, the wait for GST has been
long and hard.

Below are some frequently asked questions about GST

Q: What is the Goods and Service Tax or GST?
A: The Goods and Service Tax or GST as it is more commonly referred to is a system of
taxation where there is a single tax in the economy for goods as well as services. This is meant to
bring together the state economies and create a single taxation system in the entire country for all
goods and services.

Q: What are the stages covered in the GST?
A: All the stages related to a good or a service is covered under the GST. This means that it is a
levy that will cover the manufacture, consumption and sale of various goods and services. This
will be undertaken at a national level, so it is comprehensive in nature
.
Q: What is the main change that will be witnessed with the introduction of the GST?A: The biggest benefit that will be witnessed with the introduction of the GST is that multiple
taxes that currently exist will no longer remain in the picture. This means that taxes like octroi,
CENVAT, central sales tax, state sales tax, entry tax, license fees, turnover tax etc will no longer
be present and all that will be brought under the GST. Businesses thus will not have to deal with
multiple taxes but will be able to undertake the tax compliance in an easy manner.

Q: What is the main feature of the GST?A: The main feature of the GST is that there is a tax credit available at each stage of the value
chain. There is a value added at each stage right from manufacture to each additional stage of
sale but the tax to be paid is only on the value added instead of the whole amount. So for
example if there is a tax paid on Rs 2 lakhs at 15 per cent at the first stage then the tax here will
be Rs 30,000. At the next stage when the same goods are sold at Rs 2.5 lakh then the tax would
be Rs 37,500 but there is a set off of Rs 30,000 available so the actual tax at that stage will come
to just Rs 7,500.

Q: Who bears the final tax in the process?A: The GST is an indirect tax which means that the tax is passed on till the last stage wherein it
is the customer of the goods and services who bears the tax. This is the case even today for all
indirect taxes but the difference under the GST is that with streamlining of the multiple taxes the
final cost to the customer will come out to be lower on the elimination of double charging in the
system.

Q: Where is the GST going to be collected?A: The GST is collected at the point of sale so there is no confusion about when this has to be
paid. Currently different taxes are collected at different stages of the process so there is a tax on
manufacturing, one at the time of sale and even another one when goods move from one place to
the other. Under the GST all of these will be eliminated making it easier to implement and
follow.

Q: Will the rate rise in case of GST making it costlier?A: There will be a standard rate present under the GST. This will make the impact different for
various goods and services across the country depending upon the current or existing rate. If the
existing rate is higher then the GST will lead to a lower rate but if the rate is lower than the rate
will be higher. However it is expected that with multiple taxes eliminated it will ultimately lead
to savings for the consumer.

Q: Will all goods and services be covered under the GST?A: Except for a specific list of exempted items all the other goods and services will be covered
under the GST making this a comprehensive tax in the Indian Economy. In fact this will be the
main tax on the indirect tax side in the economy.

Q: Will the GST impact other taxes like income tax or corporate tax?A: Income tax and Corporation taxes are direct taxes which means that they have to be paid by
the person or entity on whom they are levied and cannot be passed on to someone else. They will
remain as they exist currently but the change will occur in all indirect taxes present in the
country.

Q: Is this an accepted system of taxation across the world?A: Most of the countries across the world have a GST in place. In fact by some estimates more
than 140 countries have implemented the GST in their economies.

Q: Why are states unhappy with the GST?A: The replacement of the existing taxes with the GST will lead to a revenue loss for the states.
The states want compensation for this and the matter is how they will be compensated. So there
are efforts to arrive at a formula that is acceptable to the states.

Q: What are some of the benefits of GST?A: Among the benefits that the GST will present for the Indian economy is that the entire
structure of taxation will be simplified. This is likely to lead to more compliance and this will
raise the total level of taxes in the economy. It will also lead to a fall in costs in many cases
making several products competitive leading to benefits for the manufacturers and also making
some of them competitive on the world stage. Over a period of time the consumer will reap the
benefits of the process through lower costs.

                                   
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Tuesday 29 July 2014

Training for Authors - How to become author and start posting


In this post I shall describe how to become author and to start posting.
Update (30-07-2014) - Added Video (see below)

Before discussing this, Let's see how blogs work.
  • The blog unlike websites have dynamic contents. 
  • Similar to Facebook timeline or Twitter feed, a blog's post are updated.
  • Newer post appear before the older posts. Hence home page always have newest post.
  • To view entire contents of the post, people generally need to go to post URL. Where they can add comments [Comments are currently disabled on this blog, shall be enabled after completing the designing]
This blog is hosted on "Blogger.com" a Google Product. To post content on blog, go to - blogger.com and login into your Google account. If you are already login then it shall directly taken to list of blogs you can post to.

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Monday 28 July 2014

Welcome to Indirect Tax India Blog


Hi Visitors,
I welcome you all to my new blog on Goods and Service Tax (GST). Where all the News, Articles, Explanation, Discussion about new Tax "GST" shall be posted.

This shall be my 3rd blog after 
  1. xbrl for Indian CA - 18,000 Visitors (As on 29th July 2014)
  2. LBT Thane - 1,35,000 Visitors (As on 29th July 2014)
My others small blogs include - LBT Books (For LBT books), Nihit sir direct Tax (Under construction), Set balance in Life (Motivation Articles and Poems by Dad)  Which have combined visitors for around 10,000 as on 1st July 2014.

To those who are not familiar with me, I am Adrash Madrecha, Son of CA Ashok Madrecha. Having interest in New Taxation Laws and Computers. I am currently pursing my CA course and in my Final Year.

This blog shall be a little different than my earlier blogs, instead of me only posting all articles, I invite all experts in Indirect Taxation to be Authors of this blog and post their articles here and earn recognition of themselves.

The authors shall be posting their articles from their own accounts, Their names shall be automatically be near their articles by Blogger. Their names shall also appear when any post appears in Google Search or any Search engine for that matter.

The following are the requirements for becoming a author for this blog
  1. A Google account is a must. If you have a Gmail then you have a Google account already. Just visit plus.google.com to add your photo and details about yourself as this profile shall be linked when you become author.
  2. Knowledge about Indirect tax (CA, Advocate, CS, Tax Practitioner, CA Final Student)
  3. Some knowledge about blogger is recommended. But if you have a decent android phone then No knowledge about blogger would do. As there is an app for posting to blogger directly though the phone and let me inform you that learning blogger is not at all difficult. It is just like using MS word online.
  4. That's all
Interested persons can send me a message on Google Plus or Facebook or Fill in the Contact Me form if I don't know you yet. Please give a short intro of yourself in the message. Check your spam folder if you don't receive reply in 24 hrs.

I have just created this blog, so not have applied any customizations to this blog. In future this blog shall definitely look awesome then what is present today. To just have a glimpse of this visit my recently customized Blog - Set Balance In Life   
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