The proposed Indian GST has dual structure with defined functions and responsibilities of the centre Government as well as the states Government.
- There are three components in Indian GST
One levied by centre – CGST
One levied by states – SGST
IGST on inter -state supply of goods and services.
- There are multiple statutes – one for CGST & SGST and other statutes forevery state.
- It has all basic features of a law , like changeability, definition of taxable person, measure of levy including valuation provision ,basis of classification ,etc . will be same.
- CGST & SGST to be applicable to all transaction of goods and services ,except –
Exempted goods and services – to be decided by GST council
Goods outside the purview of GST i.e., specified petroleum goods & liquor
Transaction below prescribed threshold limits- limit to be decided by GST council
- CGST and SGST treated separately .
- Input of CGST could be utilized only against output CGST.
- The same principle of input credit will be applicable for SGST.
- Cross utilization of input tax credit between CGST and SGST will not be allowed ,except- in inter-state supply of goods and services under the IGST model.
- It will replace multiple taxes with a single tax operating at various levels of supply chain, thus, avoiding the cascading effect of multiple taxes.