Mar 14

GST

Team Antworks

GST (Goods and Services Tax) is a single indirect tax aimed at making the country a unified common market. It is imposed on the supply of goods and/or services within India. Multiple indirect taxes that the Central Government or State Governments impose on suppliers and consumers are subsumed by GST.

GST Calculator

A GST Calculator is an effective tool that can be used to calculate the cost of products and services. A GST Calculator is available to help you determine the amount of tax applicable to a certain commodity or service. The formula for the addition of GST is as follows:

GST Amount = (Original Price x GST Rate) / 100

Net Price = Original Price + GST Amount

For instance, if a commodity is sold from Mumbai to Bengaluru for Rs.5000, and the rate of GST is 12%, the GST amount applicable to the product will be (5000 x 15) / 100 = Rs.750; and the net price will be Rs.5000 + Rs.750 = Rs.5750.

The formula for the removal of GST is as follows:

GST Amount = Original Price – (Original Price x (100 / (100 + GST Rate)))

Net Price = Original Price – GST Amount

Calculation of Tax under GST

Here is a table that shows a contrast between the amount of tax applicable under the previous taxation system and the amount charged under GST (Tax rates have been assumed for the purpose of this example):

Details	Tax under Previous Regime	Tax under GST
*Value to Manufacturer*
Production cost	Rs.2 lakh	Rs.2 lakh
+ Profit Margin (10%)	Rs.20,000	Rs.20,000
+ Excise Duty (12%)	Rs.26400
Total Production Cost	Rs.2,46,400	Rs.2,20,000
+ Value Added Tax (12.5%)	Rs.30,800
+ State GST (6%)		Rs.13,200
+ Central GST (6%)		Rs.13,200
Manufacturer’s Invoice Value	Rs.2,77,200	Rs.2,46,400
*Value to Wholesaler*
Cost of Products	Rs.2,77,200	Rs.2,46,400
+ Profit Margin (10%)	Rs.27,720	Rs.24,640
Total Value	Rs.3,04,920	Rs.2,71,040
+ Value Added Tax (12.5%)	Rs,38,115
+ State GST (6%)		Rs.16,262
+ Central GST (6%)		Rs.16,262
Wholesaler’s Invoice Value	Rs.3,43,035	Rs.3,03,564
*Value to Retailer*
Cost of Products	Rs.3,43,035	Rs.3,03,564
+ Profit Margin (10%)	Rs.34,304	Rs.30,356
Total Value	Rs.3,77,339	Rs.3,33,920
+ Value Added Tax (12.5%)	Rs.47,167
+ State GST (6%)		Rs.20,035
+ Central GST (6%)		Rs.20,035
Retailer’s Invoice Value	Rs.4,24,506	Rs.3,73,990

Here is a table showing the calculation of tax for inter-state sales:

Details	Tax under Previous Regime	Tax under GST
*Value to Retailer*
Cost of Commodities	Rs.2 lakh	Rs.2 lakh
+ Value Added Tax (12.5%)	Rs.25,000
+ Integrated GST (12%)		Rs.24,000
+ Central State Tax (2%)	Rs.4,000
Total Value to Retailer	Rs.2,29,000	Rs.2,24,000

As seen from the above example, the cost of commodities sold within a certain state or even between states will reduce the cost for manufacturers, wholesalers as well as retailers.

GST Registration

GST registration is mandatory for any entity that engages in the supply of goods and services within India. The bill for the implementation of GST was approved by the Prime Minister of India, Narendra Modi so that indirect taxes imposed by the central or state governments could be subsumed under one single tax. Here is a simple procedure to complete GST registration from the comfort of your home:

Log on to www.gst.gov.in.
The menu atop the page has a tab called ‘Services’, click on it and you will get three options – ‘Registration’, ‘Payments’, and ‘User Services’.
Click on ‘Registration’ and choose ‘New Registration’ to start with Part A of the registration process.
A new page will open and here you will be required to select your status as a GST practitioner or a taxpayer.
A few details will then have to be entered in the form, such as the legal name of the business, the district and state in which the business is located, email address, mobile number, Permanent Account Number, etc.
The portal will then verify your details and you will receive a One Time Password for confirmation.
Enter the OTP in the OTP Verification window and click on ‘Proceed’.
The system will generate a Temporary Reference Number which will be displayed on the screen.
The Temporary Reference Number will have to be used to login to Part B of the registration process.
Enter the Temporary Reference Number along with the Captcha Code to start with Part B of the registration process.
‘My Saved Application’ will appear on a new page, and you will have to click on the ‘Edit’ icon (white pen in a blue square) under the ‘Action’ option.
You will be redirected to the registration application form with different tabs, such as Business Details, Authorised Signatory, Promoter/Partners, Authorised Representative, Principal Place of Business, Additional Places of Business, Bank Accounts, Goods and Services, State Specific Information and Verification. You will have to click on each of the aforementioned tabs to enter the required information.
Next, enter the information related to the commodity before you select ‘Save & Continue’.
You will then have to fill in information regarding your bank account and then upload the relevant documents.
You will then be redirected to the verification tab where the details you have sent for verification are displayed. You will be required to put your digital signature on the application after you have filled it up. Digital signatures can be put using EVC, E-Signature, or Digital Signature Certificate. Companies and LLPs can use only Digital Signature Certificates.
Hit the ‘Submit’ option and the updated details and documents will be saved.
Hit ‘Proceed’ and you will be redirected to a pop-up window where you will have to click on ‘Sign’.
Once you have signed the form, you can submit it so that an acknowledgment can be sent to your registered mobile number and email in the form of the Application Reference Number.
A GST officer will then verify your application number to determine whether it can be approved or rejected. If your application is rejected, you will have to provide some more information or documents until the authorities are convinced to approve your application.

GST Rates in India

Most of the commodities and services that are subject to GST have been categorized under four tax slabs, viz. 5%, 12%, 18%, and 28%. However, GST Rates is not applicable to some goods and services, such as jute, fish, eggs, fresh meat, milk, chicken, curd, fresh fruits, buttermilk, vegetables, natural honey, bread, salt, besan, prasad, sindoor, printed books, bindi, judicial papers, newspapers, handloom, bangles, horn cores, bone meal, bone grist, horn meal, hoof meal, palmyra jaggery, cereal grains hulled, colouring and drawing books, etc.

Here is a list of goods and services under the different tax slabs:

Commodities subject to 5% GST:

Agarbatti
Apparels up to Rs.1,000
Braille paper
Braille typewriters
Braille watches
Cashew nuts
Coir mats
Domestic LPG
Edible oils
Fertilizers
First-day covers
Fish fillet
Floor covering
Footwear up to Rs.500
Frozen vegetables
Hearing aids
Insulin
Matting
Medicines
Milk food for babies
Packaged food items
Packed paneer
Pizza bread
Postage stamps
Revenue stamps
Roasted coffee beans
Rusk
Sabudana
Skimmed milk
Spices
Stamp-post marks
Stent
Sugar
Tea

Services Subject to 5% GST:

Transport services such as airways and railways
Air travel in economy class
Sale of advertisement space for print media
Supply of tour operators’ services
Road transport by radio taxis and motor cabs
Small restaurants earning turnover up to Rs.50 lakhs

Commodities Subject to 12% GST:

Almonds
Animal fat sausage
Apparel above Rs.1000
Ayurvedic medicines
Bhujia
Butter
Cake servers
Carom board
Chessboard
Chutney
Diagnostic kits and reagents
Exercise books
Fish knives
Forks
Frozen meat products
Fruit juice
Fruits
Ghee
Glasses for corrective spectacles and flint buttons
Jelly
Jam
Ladles
Ludo
Mobile
Murabba
Namkeen
Non-AC restaurants
Notebooks
Nuts
Packaged dry fruits
Packed coconut water
Pickle
Playing cards
Preparations of vegetables
Sewing machine
Skimmers
Spoons
State-run lotteries
Tongs
Tooth powder
Umbrella
Work contracts

Services Subject to 12% GST:

Air tickets by business class
Guest houses, inns, and hotels with room tariff ranging between Rs.1000 and Rs.2500 per night

Commodities Subject to 18% GST:

Aluminium foil Furniture
Bamboo
Bidi Patta
Biscuits
Branded garments
Cakes
Camera
CCTV
Circuits
computers
Corn flakes
Curry paste
Electrical transformer
Envelopes
Flavoured refined sugar
Footwear priced above Rs.500
Hair oil
Headgear
Ice cream
Instant food mixes
Kajal pencil sticks
Mayonnaise
Mineral water
Mixed condiments
Mixed seasonings
Monitors
Optical Fiber
Padding pools
Swimming pools
Pasta
Pastries
Preserved vegetables
printed
Printers
Salad dressings
Soap
Soups
Speakers
Steel products
Tampons
Tissues
Toiletries
Toothpaste
Weighing machinery (non-electrical or electronic)

Services Subject to 18% GST:

AC hotels serving alcohol to customers
Guest houses, inns and hotels with room tariff ranging from Rs.2500 and Rs.5000 per night
IT services
Telecom services