<p style=”text-align: justify;”>The Constitution (122) Amendment Bill on the back of a broad political consensus, comes at Rs and Congress. Which holds important cards on its passage ‘ Happy ‘ enhanced by. Here’s how the GST is different from current arrangements. How it will work and what will happen if the bill clears Congress.Goods and Services Tax (GST). India‘s largest indirect tax structure after the economy began to improve, to opened 25 years ago, looks set to become reality at last.
The Constitution ( 122 ) Amendment Bill in the Rajya Sabha today with 203 votes, comes on the back of a broad political consensus and the Congress. Which holds important cards on its passage ‘ Happy ‘ enhanced by. Here’s how the GST is different from current arrangements. How it will work and what will happen if the bill clears Congress .
GST Bill – the day after the government indicate more than 18 %
There are 3 Stages:
Say , a manufacturer shirt imagine. Fabric , thread , buttons , sewing equipment – – 100 rupees , an amount that includes tax of Rs 10 buys raw materials or inputs . With these raw materials , he makes a shirt .
Shirt -making process , the manufacturer content that adds value to start out with . The value added by him 30 bucks , we manage to be . His best overall value , then Rs 100 + 30 , or will be Rs 130 .
A tax rate of 10% in production ( the shirt ) but under GST tax will be Rs 13 , this tax ( Rs 13 crore ) against the already raw materials / inputs ( has paid Rs you can set off 10).
Therefore , the effective GST event producer only 3 bucks ( – 10 to 13 ) is .
The next step of passing is the best of the manufacturer to wholesaler . Wholesalers buy it for 130 bucks , and adds value to say ( which is basically your ‘ margin ‘ ), the aggregate value of Rs 20. Well maybe if he sells Rs 130 + 20 – or 150 bucks.
10% tax on this amount to Rs 15. But maybe , under the GST , the manufacturer ( Rs 13 ) at his best bought their issue ( Rs 15 ) can be set off against tax . Thus , the effective GST event wholesaler only 2 ( 13 – 15 ) is Rs .
In the final stage , a retailer buys shirts from wholesalers .
For the purchase price of Rs 150 , the price , or margin , say , 10 bucks says .
The gross value of what he sells , therefore , Rs 150 + 10 , or is it up to Rs 160 , 10 % lower , would be Rs 16 .
But wholesalers ( Rs 15 ), the tax on his purchases ( Rs 16 crore ) by setting off against tax , the effective GST Event 1 retailer himself ( 16, 15) brings down again .
Thus, the raw material / input suppliers throughout the value chain manufacturer, wholesaler through (since they themselves did not buy anything , which can claim a tax credit ) and the retailer , Rs 10 + 3 + 2 + 1 on the GST , or 16 rupees .