List of Taxes Included in GST & Benefits of GST (List of Indirect Taxes)


List of Taxes Included in GST & Benefits of GST (List of Indirect Taxes): Check Complete of Indirect Taxes Included and Excluded in GST. Introduction of Goods and Services Tax (GST) will indeed be an important perfection and the next logical step towards a widespread indirect tax reforms in India. GST Scheme was supposed to be implemented from 1st July 2017 but this deadline seems difficult to be met as the Constitutional Amendment Bill has been stuck in Rajya Sabha. However, the department has said that the GST can be implemented anytime in 2017 once the Bill is passed. GST implementation will lead to immense scope, opportunities and challenges for the chartered accountant professionals having expert knowledge in the subject. This article seeks to provide a quick and sound understanding of List of Taxes Included in GST and Benefits of GST


List of Taxes Included in GST and Benefits of GST

Indirect Taxes That Will Be Included Under GST

State taxes which will be subsumed in SGST

  • VAT/Sales tax
  • Entertainment tax (unless it is levied by local bodies)
  • Luxury tax
  • Taxes on lottery, betting and gambling
  • State cess and surcharges to the extent related to supply of goods and services.
  • Entry tax not on in lieu of octroi
  • Electricity Duty

Central taxes which will be subsumed in CGST:

  • Central Excise duty
  • Special Additional Duty of Custom (SAD)
  • Additional Custom Duty (CVD)
  • Additional excise duty
  • The excise duty levied under The Medical and Toiletries Preparation Act
  • Service tax
  • Additional customs duty, commonly known as countervailing duty (CVD)
  • Special additional duty of customs (SAD)
  • Education cess
  • Surcharges
  • Tax on advertisement other than in Press/ TV/ Radio
  • Taxes on lottery, betting and gambling

List of Taxes Not Included in GST

Taxes That May or May Not Be Subsumed Due To No Consensus Between The Central And The State Governments and various other reasons

  • Basic Custom duties
  • Stamp duty
  • Vehicle tax
  • Property tax
  • Excise on liquor
  • Tax on sale / consumption of electricity
  • Electricity duty
  • Other entry taxes and octroi
  • Entertainment tax (levied by local bodies)
  • Basic customs duty and safeguard duties on import of goods into India

Benefits of GST

GST has been envisaged as a more efficient tax system, neutral in its application and attractive in distribution. The advantages of GST are:

  • Wider tax base, necessary for lowering the tax rates and eliminating classification disputes
  • Elimination of multiplicity of taxes and their cascading effects
  • Rationalization of tax structure and simplification of compliance procedures
  • Harmonization of center and State tax administrations, which would reduce duplication and compliance costs
  • Automation of compliance procedures to reduce errors and increase efficiency
Benefits To Trade Benefits To Consumers
Reduction in multiplicity of taxes Simpler Tax system
Mitigation of cascading/ double taxation Reduction in prices of goods & services due to elimination of cascading
More efficient neutralization of taxes especially for exports Uniform prices throughout the country
Development of common national market Transparency in taxation system  Increase in
Simpler tax regime (1.Fewer rates and exemptions, 2. Distinction between Goods & Services no longer required Increase in employment opportunities

Reduces transaction costs and unnecessary wastages: A single registration and a single compliance will suffice for both SGST and CGST provided government produces effective IT infrastructure and integration of states level with the union.

Eliminates the multiplicity of taxation: The reduction in the number of taxation applicable in a chain of transaction will help to reduce the paper work and clean up the current mess that is brought by existing indirect taxation laws.

One point single tax: There would be focus on business rather than worrying about their taxation that may crop at later stages. This will help the business community to decide their supply chain, pricing modalities and in the long run helps the consumers being goods competitive as price will no longer be the function of tax components but function of sheer business intelligence and innovation.

Reduces average tax burdens: The cost of tax that consumers have to bear will be certain and it is expected that GST would reduce the average tax burdens on the consumers.

Reduces the corruption: As the number of taxes reduces so does the number of visits to multiple departments reduces and hence, the reduction in corruption.

In all cases except a few products and States, there would be uniformity of tax rates across the States.

Check also:

Section 12 of IGST – Place of supply of services where…

Section 14 of IGST – Special provision for payment of tax…

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