In India, they levy an indirect tax called the Goods and Service Tax (GST). it replaced many other indirect taxes and so it simplified the business and transportation of the goods. This has been in effect since July 1, 2017. It falls into 5 tax slabs ranging from 0% to 5%, 12%, and 18% to 28%. Apart from these, the individual state governments will tax other products such as petroleum products and alcoholic drinks.
Service tax is compulsory
All businesses in India need to pay the service tax. Any service you provide is subject to the service tax and remains governed by the finance act. The service tax came into effect from July 1, 1994 and was initially introduced only for three services – Non-Life insurance services, Telephone services, and Stock Broker services. Since 2016, the rate of the service tax is 15%. With effect from October 1, 2011, online filing of service tax return is the norm.
In most cases, they levy the service tax at the place where they give the service. But, they may also levy it after they complete the service. To fill in the service tax electronically, you must get registered at the Automation of Central Excise and Service Tax (ACES). Fill in the ACES Declaration Form and hand it over to the Range Superintendent.
Prepare your ST3 return
They will send a Temporary Personal Identification Number (TPIN) and a password to your email address. Now, you have to go to the Government website and login by clicking on Service Tax. Here you get a hyperlink to help you prepare the ST3 return. Fill it and click on Save. You can also fill in the data offline by using the Excel utility. You can download the Excel utility from the ACES page.
GST is a destination-based entity levied on goods and services. One of the good things about the GST is that it avoids the cascading effect of taxes. This cascading effect adds to the value of the goods sold and the burden comes from the customer. This means that a tax gets added at each of the production stages so that tax gets added to the taxed item. Through the GST only the actual value of the goods gets taxed and you avoid double taxation.
File the GST tax online
You can pay GST tax India by going online. Or, you could use one of the many service providers who will help you file the taxes for you. Say, you are a business entity and you do not have much familiarity with the taxation process (as is the case with new entrepreneurs). Then, it is advisable to use the services of the software providers for paying the taxes. The GST provides a higher threshold for registration.
The online procedure for filing of GST is much simpler than the conventional method. This improves the efficiency in the logistics and brings more clarity to the picture. There is a less need for compliances and small businesses can use the composition scheme. It helps regulate the unorganized sector since you only need to go to the GST portal for everything.