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admin wrote this blog titled "What is Goods and Services(GST) Tax Law?"

The Goods and Services Tax has revolutionized the Indian taxation system. The GST Act was passed in the Lok Sabha on 29th March, 2017, and came into effect from 1st July, 2017.

GST is destination based comprehensive tax struncture based on value addition and replaces several indirect tax laws.
Components of GST are :-
1. CGST - This is collected by central government on intra-state sales (within Kerala).
2. SGST - This is collected by state government on intra-state sales (within Kerala).
3. IGST - This is collected by central government and then shared with destination state. 
 
If good is sold from Karnataka to Kerala. Kerala will get share in IGST.
CGST and SGST on intra-state sales is equal. If some good attract 18% GST, then 9% goes to CGST and 9% to SGST.
 
All goods are identified by HSN code and all services are identified by SAC codes. These codes are international standard.
 
GST is destination based tax where receiver can avail input credit.  If some good is manufactured for rs 200 and manufacturer has paid 10% tax means rs 20. When it comes to distributor and if price is rs 260 due to value addition by distributor, he need not pay 0.10*260=rs 26, instead, he can get input credit of rs 20 and pay only 26-20=rs 6.
Due to this input credit, it is expected that goods and services should become cheaper even though tax rate has been enhanced under GST.

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