The central government is planning to introduce the Goods and Services Tax (GST) from April 2010. This will be an important step towards indirect tax reforms in the country. It will create a common market within India for the first time. This article throws light on various aspects of GST, its features and advantages.

With the introduction of Goods and Services Tax (GST), various central levies such as excise, Value Added Tax (VAT) and service tax would be subsumed, making it a lot easier for the business and industry. The GST would also merge into itself the other levies like additional customs duty (also called countervailing duty), excise duty on medicine and toiletries. According to a discussion paper released recently by the Empowered Committee of State Finance Ministers, taxes levied by the central government like excise, additional excise duty and various surcharges and cesses would be part of the GST. Besides these central levies, several taxes presently being levied at different levels will also become part of the GST. These include: VAT, sales tax, entertainment tax (except the one levied by the local bodies), luxury tax, taxes on lotteries, betting and gambling and State cesses and surcharges and the entry tax. However, alcohol and petroleum products would not be covered under GST, though tobacco would attract GST.

India is set to take the most important step ever towards indirect tax reforms with the introduction of the GST from April, 2010. This will abolish the `central sales tax' and include services under VAT.

Hence, for the first time, State governments will be able to tax services. The GST will have a uniform tax rate structure throughout the country. It will create a common market within India for the first time.

Portfolio Organizer Magazine, Goods And Services Tax, GST, Value Added Tax, VAT, Business Landscape, Business Laws, Special Economic Zones, Domestic Tariff Area, Provincial Retail Sales Taxes, Local Bodies, Indirect Tax Reforms, Petroleum Products.