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Prominent features of draft GST Bill

As per Model GST law, a threshold annual turnover for levy of the tax will be at Rs 10 lakh

Policy Pulse
Publish Date: Jun 15 2016 9:40AM | Updated Date: Jun 15 2016 11:27AM

Prominent features of draft GST Bill

GST will be charged at the first point of transaction in sales of goods and services under the regime of uniform Goods and Services Tax (GST) likely to be rolled out in April next year.

 
The model GST law, circulated in the meeting of Empowered Committee of State Finance Ministers, said a threshold annual turnover for levy of the tax will be at Rs 10 lakh. For North East and Sikkim, the limit will be at Rs 5 lakh.

Following are the salient points of the draft GST bill:
 
* GST rate not stated in the constitutional amendment bill, as desired by the Congress. Finance Minister Arun Jaitley said there was broad consensus at the empowered committee meeting that there should be no constitutional cap on the GST rate.
 
* All forms of "supply" of goods and services such as sale, transfer, barter, exchange, license, rental, lease and import of services of goods and services made for a consideration will attract CGST (central levy) and SGST (state levy).
 
* As GST will apply on "supply", the erstwhile taxable heads such as "manufacture", "sale" and "provision of services", among others, will lose relevance. 
 
* The liability to pay CGST or SGST will arise at the time of supply. 
 
* With GST to be applicable according to whether a transaction is "intra-state" or "inter-state", separate provisions are there to help an assessee determine the place of supply for goods and services.
 
* States will draft their own State GST based on the draft model law with minor variations.
 
* GST would be payable on "transaction value", being the price actually paid or payable, and said to include all expenses in relation to sale, such as packing and commission.