India has been edging up by leaps and bounds on the ‘Ease of Doing Business’ Index, compiled by the World Bank. Its implementation of the Goods and Services Tax (GST) system has helped increase compliance and bring many hundreds of traders and small businesses within the tax net. Additionally, the new system is meant to ensure lesser complications at the time of setting up new businesses or if existing businesses wish to apply for business loans.
Businesses can get a small business loan through Finserv MARKETS, and easily avail loans up to Rs. 30 lakh in under 3 minutes. Business loans can help expand production and enhance operations significantly. With the GST implemented, businesses can save time by providing their GSTIN (Goods and Services Tax Identification Number) which can aid faster processing of business loans.
However, this overhaul of the taxation system has given rise to a lot of confusion for people regarding which are the taxes which will no longer be applicable, the rate of taxation that will be applicable to goods, and which authorities will be collecting the taxes.
Read on below to understand the 10 most basic facts about implementation of the GST.
What are the GST rate slabs?
GST rate slabs refer to the different rates at which goods and services will be taxed. It is four-tier tax structure, with rates at 5%, 12%, 18% and 28%. Aside from this, some essential food and non-food items which are consumed on a daily basis will be taxed at 0%.
What’s the difference between CGST, SGST and IGST?
Previously in India, different taxes were collected by the Centre and state governments. This led to some goods and services being subjected to double taxation by both authorities. Now with the GST rolled in, the tax will be halved with the Centre drawing in the Central GST and the state government levying State GST. Each good and/or service will be taxed just once at the place of supply.
What are the taxes that will no longer be levied?
The GST has subsumed several taxes within its ambit, namely the Central Excise Duty, the Central Sales Tax, Value Added Tax, Luxury Tax, Purchase Tax, Advertisement taxes, Service Tax, Countervailing Duty, Octroi, Entertainment Tax and all taxes applicable on lottery.
Which are the items excluded from GST?
While construction of a new building is taxed under GST, the sale of land and sale of building is not taxed. GST is also not charged for employment, where employees are still required to pay income tax on salary earned. There are also taxes for funeral services, or for duties performed by most government elected representatives.
What’s the turnover threshold for businesses on which GST would be levied?
Businesses reporting a turnover of upto Rs. 40 lakh would be exempt from paying GST. For the north eastern and hill states, this exemption is for businesses reporting a turnover of upto Rs. 20 lakh.
Will GST be levied on business loan repayments?
Business loans availed from banks and financial institutions will not be subject to GST. You can get a small business loan and use it to meet your working capital requirements, without worrying about the repayment becoming more expensive due to GST. Apply for business loan on Finserv MARKETS today, and you can have loans upto Rs. 30 lakh approved in less than 3 minutes. This business loan does not require any collateral, and can be repaid over a flexible tenure ranging from 12 to 60 months.
What is the e-Way Bill?
The Electronic Way Bill (or e-Way Bill) is a unique document generated specifically for the specific consignment or movement of goods from one place to another. The bill is generated for both intra-state and inter-state trade, and for goods valued at more than Rs. 50,000. Registered persons, whether the sender or the recipient, can generate the e-Way Bill.
What happens if I don’t comply with GST?
GST has been implemented to ensure maximum compliance from taxpayers. As a result, several provisions have also been made for those failing to comply. A total of 21 offenses have been recognised under GST, which include not registering under GST, supplying goods or services without generating invoices, issuing invoices using GSTIN of other taxpayers, and obtaining refund by fraud.
What are the documents required for goods in transit?
Any vehicle that is carrying goods that exceed the value of Rs. 50,000 must carry an invoice or bill of supply, as well as a copy of the e-Way Bill.
Will there be inspection under GST?
If the recognised authority has reasons to believe that a person has suppressed transactions or claimed excess input tax credit in order to evade tax, they can authorise inspection of the premises of the business of the concerned person.
The GST has already begun showing results in its aim to form a single unified system of taxation in the country. Compliance is expected to increase, with more number of taxpayers being brought into the net. Additionally, businesses are expected to thrive through implementation of the GST with lesser documents and paperwork required for compliance. Businesses looking to get a small business loan can now do so easily online, without worrying about GST being implemented on repayment of these loans. Apply for business loan on Finserv MARKETS, and get access to working capital instantly without providing any security or collateral. Read what are the benefits of taking a business loan online only at Finserv MARKETS.
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