I-GST
In this artical you will know about IGST. Their Origin, Salien features, and Advantages.
What is IGST?
The full form of IGST is Integrated Goods and Services Tax, IGST is charged when there is the movement of goods and services from one state to another. For example, if goods are transported from Rajasthan to Haryana, IGST will be levied on such goods. The revenue from IGST is shared by the state government and the central government as per the rates fixed by the authorities.
Origin and starting of IGST Act
The Act is called the IGST Act 2017, which is an act enacted for levying, collect and administer IGST in India.
The Act applies to the whole of India, that is, including the state of Jammu and Kashmir.
Salient features of IGST Act 2017
There is no need for an inter-state seller or buyer to pay advance tax or a substantial interruption of funds.
Continuation of seamless ITC chain on interstate transactions.
There is no claim for refund of taxes paid in the exporting state, as ITC is used when paying tax.
Self-monitoring model.
Streamlining activity is limited to inter-state dealers, central and state governments.
Various Features of IGST Model
The features of the IGST model are given below:
Charges were levied on intrastate and interstate transactions of goods and services.
The same IGST rate will be followed in India.
Interstate merchants can pay IGST only after adjusting the transactions of inputs SGST, IGST, and CGST.
Sharing between Centre and State.
Things to keep in mind
About IGST, you have to remember two important points:
Integrated Goods and Services Tax or IGST is a combination of state share (SGST) and central government share (CGST).
The importing state receives the final tax revenue. For Example - Suppose Rajesh, a businessman from Rajasthan sold goods worth Rs 1,00,000 to Suresh of Gujarat (Gujarat is an importing state). The GST rate is 18% which includes 18% IGST. In this case, the dealer has to charge Rs 18,000. In the form of IGST, this IGST will go to the center, then the center will keep 9% with itself and give 9% to the importing state.
Advantage of the IGST Model
There will be no additional burden on the taxpayers as the entire process of payment will be expedited.
Manages tax neutrality in India.
It is easy, transparent, and can be managed by a self-model.
Tax payment is done through an online platform which makes the process easy and error-free.
There is no need for physical document verification and claims as all data is saved in the GSTN portal.
Interstate sellers and buyers will not face an interruption of funds or advance payment of tax.
To check whether the ITC (Input Tax Credit) chain is continuous for interstate transactions.
‘Business to Business (B2B) and ‘Business to Consumer (B2C) transactions will be managed properly.
It is not mandatory to claim a refund in the exporting state as ITC will be used during the payment of tax.
The cost of GST compliance will be reduced due to uniform tax rates and simplified procedures in India.
Disclaimer: This article is intended for general consumption only. The information in the article was accurate at the time of publication, but it is subject to change due to changes in government rules and regulations. The contents of the blog may not be copied unless prior permission is obtained.
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