The change that is now recognized as one of the biggest reforms made in India that changed the entire game of how and what taxes are paid. Yes, We are talking about GST, goods and services tax, that includes many indirect taxes which were imposed by the central government such as excise, VAT, and service tax. GST has helped the MSME sector a lot by simplifying the process of filing returns, hence, decreasing their dependence on the experts who used to help them earlier with filing their taxes.
Components of GST
- State Goods and Services Tax (SGST): Tax levied by the State Government
- Central Goods and Services Tax (CGST): Tax collected by the central government
- Integrated Goods and Services Tax (IGST): Tax applicable on inter-State supply of goods and services by the central government
There are many such benefits and advantages that GST offers, and anybody who is an aware and responsible citizen of India should know about it as it affects not only the entrepreneurs but the customer as well. Some of the main benefits are
Technical Advantage It Offers
The best thing about the introduction of GST is the technology that is involved in the process which is playing to its strengths. It is now way easier to register and to file the returns. There is an online GST portal that will help you with
- Registration
- Return filing
- Application for refund
- Response to notices
- Consumer grievances
Uniformity In Taxes
Earlier, when GST was not in existence, there were several other taxes that unintentionally increased the cost of goods and services. However, GST has not absorbed all these taxes such as VAT, Excise, and service tax to rescue the cascading effect they had on the entire process. GST has brought that uniformity that much required and has ultimately resulted in the reduction of the total cost.
The Composition Scheme
GST offers a composition scheme under which small businesses that have a turnover of up to 75 lakhs can benefit by lowering their taxes by making the required changes. This has helped so many businesses with the unnecessary burden of tax and compliance.
Higher Threshold
According to this very beneficial reform, businesses that have a turnover of up to Rs. 20 Lakhs will be exempted from paying the GST. Earlier, with VAT, businesses that had a turnover of more than Rs 5 lakhs had to pay this tax. This change is speaking for the evident relaxation that has been provided to small businesses.
These are only a few of the many changes that were brought into existence to ease up the burden on the needy and to bring transparency in the whole system, Sure, which reform of this magnitude, there were some difficulties that were introduced, but the number and magnitude of the positives it brought can any day overweight the negatives.