The Goods and Services Tax (GST) is a single indirect tax on the supply of goods and services across India. It replaced many separate central and state taxes and created a common national market. GST facts are among the most asked topics in current economics sections.
Launch and Background
- GST was launched on 1 July 2017 at midnight in Parliament.
- It was introduced through the 101st Constitutional Amendment Act, 2016.
- GST is based on the idea of 'One Nation, One Tax, One Market'.
- India adopted a dual GST model, levied by both the Centre and the States.
Types of GST
- CGST - collected by the Central Government on intra-state sales.
- SGST - collected by the State Government on intra-state sales.
- IGST - collected by the Centre on inter-state sales and imports.
- UTGST - applies in Union Territories.
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GST Council and Slabs
- The GST Council is the apex body for GST decisions, formed under Article 279A.
- It is chaired by the Union Finance Minister, with state finance ministers as members.
- The main tax slabs are 0, 5, 12, 18 and 28 percent.
- A special rate applies to gold, and a cess applies to luxury and sin goods.
Items Outside GST
- Petroleum products, alcohol for human consumption and electricity remain outside GST for now.
- GST is a destination-based tax, collected where goods are consumed, not produced.
Quick Revision Points
- GST launched on 1 July 2017.
- Brought in by the 101st Amendment Act, 2016.
- Slogan: One Nation, One Tax.
- Types: CGST, SGST, IGST, UTGST.
- GST Council under Article 279A, chaired by the Finance Minister.
- Slabs: 0, 5, 12, 18, 28 percent.
- GST is a destination-based tax.