Professional Documents
Culture Documents
Taxation is
COMPLEX
243
Hours per
year doing
taxes
30+
Number of
payments
158
Indias rank for
ease in tax
payment
GST
Subsume
indirect tax
levies
Integrate state
economies
Boost to GDP
Growth
Opportunity to reimagine
a SIMPLE and
Enterprise
One view on
compliance
Transparency
DIGITAL
Speed
Remove
Redundancy
Endless POSSIBILITIES
Revamp a cumbersome & distributed process
Purchase Order
Deliverables
Invoice
Buyer
Pay
Seller
Sellers
Calculate, Aggregate and
Remit taxes
Tax
Authority
Tax Procedure
TAXINN
GST Timelines
Milestones
Lok Sabha passes GST bill
Timeline
Aug, 2015
Dec, 2015
Jan, 2016
What is Changing?
Overseas
vendor
Outside India
Overseas
service
provider
BCD,BCD,
CVD,IGST
ACD
Service tax
IGST
India
Vendor
Excise
duty, VAT
CGST
, SGST
Non-Creditable taxes
Creditable taxes
Customer
Excise
CGST
Manufacturer
State A
State B
Vendor
VAT
SGST
Institution
Service
tax
CGST
, SGST
SerIvGicSeTta
x
Service
Provider
Service
Provider
Customer
Illustrative list of Input tax credits currently not available (that might be
available under GST):
Service tax credit on freight from the place of removal to the customer and
other service tax credits currently not available
Excise credits for all business purchase expenses viz. Sales promotion
items, gifts, etc
Luxury tax paid in Hotels
Service tax credits on trading of goods
States allowed to collect additional tax (not exceeding 1%) on supply of goods in
course of inter state trade
Structure of GST
Dual GST Levy :
Integrated GST ( I-GST on Imports & Interstate Supply of Goods & Services :
To be levied by the Central Govt. .
SGST:
Luxury tax
Centre would levy IGST which would be CGST plus SGST on all inter-State
transactions of supply of taxable goods and services
Intra State
Inter State
CGST+SGST
IGST
CGST+SGST
IGST
IGST
Credit of
CGST
SGST
IGST
Cross utilization between SGST of one state and SGST of another state not
allowed
Credit of taxes paid on petroleum products not available (since it is not a part
of GST)
Present Tax
Present Indirect Tax (Excise/VAT) System in India
Foreign
V1
Imports
Custom Duty +
CVD+ SAD
Export
0% ED/CST
Foreign
Customer
Transfer
ED+0% CST
Depot
B
Local
Sales
VAT
Interstate
Sales
2% CST
C Form
Dealer
B
Local
Sales
VAT
Local Sale
VAT
Dealer
A
Local
Sales
VAT
CST
V
VAT
Outside
V2
Inter-state
Sales
(ED + 2% CST
(Tax on Tax)
State
A
MFR
(Goods )
Taxation
CST
Local
V3
VAT
Local Sales
ED + VAT
(Tax on Tax)
Customer
Customer
Customer
Imports
Custom Duty +
( I GST)
I GST
GST
Outside
V2
Inter-state Supply
IGST (C+S-GST)
State
A
MFR.
On
Supply
of
Goods &
Services
Export
0% GST
Foreign
Customer
Inter-state
Supply of
goods
IGST
Depot
B
Local
Supply
CGST +
SGST
Customer
B
Dealer
B
Local
Supply
CGST +
IGST
Customer
B
Dealer
A
Local
Supply
CGST +
SGST
Customer
A
Non Creditable 1%
Additional Tax on
interstate Supplies
Interstate
supply
IGST
(CST+SGST
)
I GST
Local
V3
C&S
GST
Local Supply
(CGST + SGST)
Local
Supply
CGST +
SGST
State A
Vendor
( IGST)
State
B
State
C
1% Addl.
Tax
150 + 30
IGST
( I GST)
Dealer
State
D
MFR - 2
MFR - 1
1%
Add
Tax
1OO + 20
IGST
( IGST)
Customer
State D
(GST)
Consuming
State
1% Addl
Tax
200 + 40 I
GST
220 + 44
GST
220 + 44
Finally , the
State D gets the S
GST Revenue
Exports
Vendor 2
Imports ( I GST)
Exports
Exporter
0% GST
Vendor 3
Foreign
Customer
Outside
India
TAX Invoice
GST Tax Invoice
Invoice No. (Serially Numbered)
Date
01 04 2016
Rs.
100.00
05.00
105.00
10% C GST
10.50
---------------------------------
10.50
Total -------------
126.00
Identify the tax cost (with respect to taxes that are supposed to merged into GST)
in the profit and loss account and start capturing the same so as to enable the
business to understand the impact of GST
Review the current operations/distribution models and evaluate the need for any
changes in the operation/distribution models on account of :
Availability of full credit under GST system; and
Impact of additional tax payable on the supply of goods in course of inter state trade
Goals
Utilization Transaction
GSTN Portal
Manufacturers/ Consumers
will download data from
the GSTN Portal.
Suppliers will upload their Sales Data
Mico
Lucas TVs
MRF Tyres
Mahindras
Tata Motors
Ashok Leyland
GSTN Portal
Manufacturers/ Consumers
will download data from the
GSTN Portal
GSTN Portal
Manufacturers/ Consumers
will download data from the
GSTN Portal
Features by SAP
Features by SAP
Discrepant Invoices Value Mismatch
Missing in GSTN
Missing in ERP
Facility to trigger an Email to the
supplier
Manufacturers/ Consumers
will download data from the
PSTN Portal
Assumptions
Assumptions
GSTN Authorities will provide
Standard API will be provided for
upload download of data, between
Manufacturers/ Consumers
will download data from the
GSTN Portal
GSTN Ecosystem
Integration of existing IT systems with GSTN
GSTN IT
System
Tax Authority
Centre/
State
Tax
System
CTD
Officer
Centre/
State Tax
Database
Accounting
Agencies &
Treasuries
Taxpayer
GSTN
Common
Portal
GSTN
Database
Network
of Banks
& RBI
Comment:
The present indirect tax levy
on goods is: 12.5% (Excise
Duty) + 14% (VAT)
Transition provisions
Refund, not credit Accumulated credit at the
cut off date cannot be carried forward
- Input and input services - CENAVT
- Capital goods CENVAT and VAT
- VAT credit
Defer capital expenditure/purchases
Treatment of Way-Bill/ C-Form/
Checkposts
Treatment of Existing Area based
Exemptions/ Benefits under State
Industrial Policy
Document Numbering
Utilization
Reporting
Tax Register
Tax Registration
Document Numbering
Unique sequential numbering for outgoing GST invoices
Criteria for legal numbering may be specified by govt.
It could be for example:
Registration level
Document type (Invoice / Credit Memo)
A combination of above
Utilization
Utilization of Input tax credit would be as under
Input CGST to be utilized against output CGST
and IGST
Input SGST to be utilized against output SGST
and IGST
Input IGST to be utilized against output IGST,
CGST and SGST in the order of IGST, CGST and
SGST
Input
Output
Reporting
Tax register
CGST
SGST
IGST
Public
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