GST stands for Goods and Services Tax which came into effect on 1 July 2017. GST is a known Indirect Tax which has replaced many other Indirect taxes in India. GST is imposed on all types of goods and services. It is one of the biggest indirect tax reform for the entire country. Its main objective is to bring a change in the overall economic growth of a nation.GST brings a uniform tax system across all the states.
Return filing under GST means sharing required information with the Tax Administrative Authorities for the taxpaying purpose. All businesses have to register under the GST act to enhance the details of the sales and purchases of goods and services. The same can also be done by filing the returns online. To file GST returns, GST compliant sales and purchase invoices are required. Any regular business has to file three monthly returns and one annual return which makes 37 returns in a year under the GST regime.
Impact of GST on traders and consumers
- The simpler tax system for consumers
- Reduction in a multiplicity of taxes for traders
- Transparency in taxation system for consumers
- Development of common national market for traders
- Increase in employment opportunities for consumers
There are mainly four types of Goods and Services Tax (GST) in India.
- Central GST- CGST
- State GST- SGST
- Union territory GST- UTGST
- Integrated GST- IGST
What is Value Addition?
The manufacturer who makes biscuits buys the ingredients for baking the biscuits. Flour, sugar and other material increase the value of that biscuit when mixed and baked into a biscuit. After baking manufacturer sells biscuits to the warehousing agent, who packs biscuits in a large amount and labels it. This is one more addition to the value which the warehouse agent sells to the retailer. Now the retailer packs it in small quantities and invests in the marketing of the biscuits thus increasing its value. This addition to the value at each stage to reach the final sale that is to the customer includes GST.
The journey of GST began in the year 2000, and it took 17 years from then to evolve the law. Many types of GST software have been announced to make the return filing easy and simpler. It saves time and money together at one point, unlike those old methods which were time-consuming. The management of account is the responsibility of the owner, operator of the warehouse and every transporter who is transporting goods and services. The returns are also designed in a way that all transactions are in sync with each other, and no transac6 is left unseen between the buyer and the seller. Moving with the updated technology is so important nowadays so that we can be in touch with the new advancements. GST system software helps in making aware entrepreneurs about the applicable tax rate they need to pay. It also helps in the improvement of GDP growth in coming 3-5 years. Therefore, every business needs an accounting system software to keep a record of the finances in sequence.