GST, Goods and Services Tax also defined as a direct tax which has replaced many indirect taxes in India. The act came into effect on 1st July 2017 and is a comprehensive, multi-stage, destination-based tax that is levied after every value addition. In case of intra-state sale, Central GST and State GST both are charged. In case of inter-state Integrated GST is charged. Welcome to our bimonthly GST Update post. Without any further ado, let us discuss the latest developments about the GST.
GST IN THE IT SECTOR
Many of our readers and customers have been asking us to write about the impact of GST in the IT industry. So, we’d like to start with that. One of the most important things that has been seen in the IT sector after the roll-out of Goods and Services Tax is ITC. ITC is also called as Input Tax Credits and is very popular among decision makers and other individuals working in the IT sector. Companies and traders in the IT industry selling goods and services could not claim service tax paid on AMCs for their computers and software before GST. With ITC, it has been made a cakewalk.
Earlier purchasing a CD, DVD or hard disk would consist of 3 taxes being levied on it:
- Excise Duty
- VAT
- Service Tax
GST on IT sector attracts 18% of software services provided by software companies. For purely software services, the cost of such services will increase under GST. If you have a software business then you need to change your accounting system and ERPs to get them in sync in with GST. This would increase infrastructure costs and also management costs. Most large companies in fact do set up teams to manage their GST.
LATEST GST NEWS AND UPDATES
- In case you are a taxpayer who’s GST registration has come to and end you are required to give the final return in FORM GSTR-10 till 31st December 2018.
- The 30th GST Council meet was held via video conferencing and revolved around the administerial progress made in GST system. There was also discussion in levying cess in case of exigencies.
- A seven member group of ministers was formed to submit recommendations to the GST council by 31st October 2018.
- The council recommended 10% cess to recover loss due to Kerala floods.
- October GST collections topped Rs 1 lakh crore. In a tweet by finance minister, he attributed the success of GST to lower rates and lesser evasion and higher compliance.
- The GST revenue rose to Rs 94,442 crore in September and the government was hopeful that it could surpass the landmark of Rs 1 lakh crore in the following months due to the festive season.
- This GST prediction suggests that collection might be improving and economic growth is set to be better in the second half of the financial year.
So, these were the latest updates about the Goods and Services Tax (GST). Found anything useful? Share it with your colleagues and friends. Feel free to let us know your thoughts in the comment box.