Explainer for you
The Lok Sabha has passed 4 GST-related laws, marking another step towards the rollout of the single national tax on July 1.
The country now faces a race to get ready for GST in the next three months.
All you need to know
Central Goods and Services Tax Bill, 2017 Integrated Goods and Services Tax Bill, 2017 Goods and Services Tax (Compensation to States) Bill, 2017 Union Territory Goods and Services Tax Bill, 2017
What does it mean?
20 lakh annual revenue threshold for GST. Tax rate capped at 40% (20% central, 20% state). Anti-profiteering measures to ensure lower taxes passed to the consumer.
2.5% flat rate compounding scheme for small businesses with turnover up to Rs 50 lakh
A centre can exempt some goods from CGST
Compensation to states for loss of revenues for five years
Cess on luxury and sin goods to create a compensation fund
Tax collected at source on CST capped at 2% (1% central, 1% state)
Registration in every state; no single registration
I-GST provides for levy of tax on interstate supply of goods Provision to set up GST appellate tribunal
Bills in Rajya Sabha
The bills will now be sent to Rajya Sabha
Being Money Bill, unlikely to face any issues in the Upper House.
States will need to pass the state GST law
Rates to be assigned to each good and services-5, 12,18, 0r 28%.
GST council to decide based on a recommendation of a committee of officials.
Rate to be fixed at closest to a current tax levied on a good.
Detailed rules to be framed based on the laws. GST council to approve the rules on March 31
Training and implementation
Training of centre and state officials in GST laws and procedures. Well tested IT infrastructure.
Registration of businesses for GST