GST – Tax Structure and After Effects

The Goods and Services Tax (GST) is on schedule for implementation from July 1. This will not lead to any significant increase in prices of goods although marginal hike can be observed in the cost of some services.The constitutional amendment gives time till September 15 for the introduction of GST but the target date has been kept at July 1. There is a cushion of two-and-a-half months but it looks like it will be able to begin on schedule.

GST rules have been framed and tax rates will be fixed at the GST Council meeting on May 18 and 19. Hailed as the biggest tax reform since India’s independence. GST will replace an array of central and state levies with a national sales tax, thereby creating a single market and making it easier to do business in the country.

Tax Structure in GST

The Goods and Services Tax (GST) Council, which had previously finalized a four- tier tax structure of 5%, 12%, 18% and 28%. This scheduled to meet next week to put different commodities and services in the decided tax brackets.

Finance Minister, Mr. Arun Jaitley said in a press conference that GST being a more efficient tax, evasion of tax will become difficult. In the current system, there are loopholes for evasion.

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