Current Affairs » Rise in GST Collection

Rise in GST Collection

Uniform Indirect tax

Why in the News?

Gross Goods and Services Tax (GST) collections rose to the second-highest level since 2017.

Key Points:

Goods and Services Tax (GST)

GST is a uniform indirect tax levied on goods and services across the country.
The Goods and Service Tax Act was passed in Parliament and came into effect on 1st July 2017.
Credits of input taxes paid at each stage will be available in the subsequent stage of value addition, which makes GST essentially a tax only on value addition at each stage.
GST is applicable on the ‘supply’ of goods or services as against the present concept on the manufacture of goods or on the sale of goods or on the provision of services.
It is based on the principle of destination-based consumption taxation as against the present principle of origin-based taxation.
Exports would be zero-rated supplies. Thus, goods or services that are exported would not suffer input taxes or taxes on finished products.

- Central Goods and Service Tax (CGST): CGST is levied on intrastate supplies by the central government.
- State Goods and Service Tax (SGST): SGST is levied on intrastate supplies by respective state governments.
- Integrated Goods and Services Tax (IGST): IGST is levied on interstate supplies by the Centre (equal to CGST + SGST combined on supplies made within the state).
  - Any supply of goods or services or both on an interstate basis typically attracts IGST on the consideration thereof.

Reasons for Surge in GST Collection:

Benefits of GST:

Components of GST