Goods and Services Tax (India)

[2] In addition a cess of 22% or other rates on top of 28% GST applies on several items like aerated drinks, luxury cars and tobacco products.

[9] A single common "Goods and Services Tax (GST)" was proposed and given a go-ahead in 1999 during a meeting between the Prime Minister Atal Bihari Vajpayee and his economic advisory panel, which included three former RBI governors I. G. Patel, Bimal Jalan and C. Rangarajan.

Vajpayee set up a committee headed by the Ministry of finance of West Bengal, Asim Dasgupta to design a GST model.

[10] The Asim Dasgupta committee which was also tasked with putting in place the back-end technology and logistics (later came to be known as the GST Network, or GSTN), in 2015.

However, in 2011, with the Trinamool Congress routing CPI(M) out of power in West Bengal, Asim Dasgupta resigned as the head of the GST committee.

The committee submitted its report in August 2013, but in October 2013 Gujarat Chief Minister Narendra Modi raised objections that led to the bill's indefinite postponement.

[13] The Minister for Rural Development Jairam Ramesh attributed the GST Bill's failure to the "single handed opposition of Narendra Modi".

With the consequential dissolution of the 15th Lok Sabha, the GST Bill – approved by the standing committee for reintroduction – lapsed.

Seven months after the formation of the then Modi government, the new Finance Minister Arun Jaitley introduced the GST Bill in the Lok Sabha, where the BJP had a majority.

[18] The Jammu and Kashmir state legislature passed its GST act on 7 July 2017, thereby ensuring that the entire nation is brought under a unified indirect taxation system.

Though the session was attended by high-profile guests from the business and the entertainment industry including Ratan Tata, it was boycotted by the opposition due to the predicted problems that it was bound to lead for the middle and lower class Indians.

[21][22] It is one of the few midnight sessions that have been held by the parliament - the others being the declaration of India's independence on 15 August 1947, and the silver and golden jubilees of that occasion.

[22] After its launch, the GST rates have been modified multiple times, the latest being on 10 May 2023 where taxpayer with over ₹5 crore turnover in any financial year from 2017 to 2018 shall issue e-invoices w.e.f.

[30][31] GST is levied on all transactions such as sale, transfer, purchase, barter, lease, or import of goods and/or services.

India adopted a dual GST model, meaning that taxation is administered by both the Union and state governments.

For inter-state transactions and imported goods or services, an Integrated GST (IGST) is levied by the Central Government.

If a company has turnover up to ₹15 million (US$170,000) in the preceding financial year then it need not mention the HSN code while supplying goods on invoices.

The central government had assured states of compensation for any revenue loss incurred by them from the date of GST for a period of five years.

Reverse Charge Mechanism (RCM) is a system in GST where the receiver pays the tax on behalf of unregistered, smaller material and service suppliers.

The Quarterly Return Filing and Monthly Payment (QRMP) Scheme is a simplified compliance regime under the Goods and Services Tax (GST) in India.

GST Council is an apex member committee to modify, reconcile or to procure any law or regulation based on the context of goods and services tax in India.

[58] GST's implementation in India has been further criticized by Indian businessmen for problems including tax refund delays and too much documentation and administrative effort needed.

[59] The opposition Indian National Congress has consistently been among the most vocal opponents of GST implementation in India with party President, Rahul Gandhi, slamming BJP for allegedly "destroying small businessmen and industries" in the country.

For instance, bicycles, which are used mostly by those low income group and rural populations, have GST of 12%, which increases cost of purchase.

Manufacturers have lobbied to reduce the GST from 12 to 5% for both regular and electric bicycles to ensure affordability among the low income groups and daily-wage earners.

Technological Hurdles: The GST regime brought in the need for businesses to file taxes online through the GSTN portal.

However, frequent technical glitches, server downtimes, and difficulties in navigating the portal posed significant challenges, especially for small businesses unfamiliar with digital tax filing.

Adopting automated billing software that assist in accurate form selection, auto-population of details, and timely submission can be instrumental.

This multi-tiered structure led to confusion about the correct tax rate applicable to specific products or services.

In conclusion, while the GST regime aimed at simplifying the tax landscape in India, its initial phase presented several challenges.