Taxes Subsumed under Gst Upsc

Need for Goods and Services Tax

The Government propose GST after the implement of VAT (Value added Tax). GST aimed at making a single tax pan India by integrating the taxes of the state and centre.

The government of India believed that by a created a single market throughout India, might help the Industry, business etc in a big way. Going by the expert’s opinions, GST has the potential to increase the GDP up to 2%.

The GST bill was passed in the parliament on 29 March 2017 and can into effect on July 1, 2017.

goods and services tax upsc
Goods and services tax

Also Check out Economy of Tamil Nadu

Suggestion for GST in the First Proposal

The GST is to be collected same as VAT and it is imposed pan India with Uniformity. That is single rate throughout the country.

Taxes subsumed under Gst Upsc

The taxes subsumed under GST are Four central taxes such as cenvat, service tax, stamp duty, and central sales tax. Also, Nine state taxes such as excise duty, sales tax/vat, entry, lease, works contract tax, luxury tax and turnover taxes and also octroi, and cess to be merged into GST.

Implementation of GST

The government of India decided to introduce GST in the financial year 2010-2011 after the Kelkar Committee Report in 2006 but the process was delayed due to various reasons such as disputes between the state and central etc.

Finally, by 101st Amendment Bill,2016 was cleared by the parliament in August 2016 and by September 2016 GST council was created.

The council had the power to make recommendations to Union and states on rates, floor rates, exceptions, etc and the new federal GST was implemented on July 1, 2017.

Gst rates in India

It is a new Indirect tax that is applied to all except Alcoholic liquor and five petroleum products such as crude petroleum, motor spirit/petrol, high-speed diesel, natural gas, and aviation turbine fuel.

Central excise duty, duties of excise(Medicinal and Toilet preparations), additional duties of excise (Goods of special importance), additional duties of excise (textile and textile products), additional duties of customs/ countervailing duties (CVD), and special additional duty of customs (SAD), service tax, and central surcharges and cesses, these 8 cental taxed subsumed under Goods and Services Tax.

State Vat, Central sales tax, luxury tax, entry tax, entertainment and amusement tax (except Local Bodies), taxes on an advertisement, purchase tax, lottery tax, betting, and gambling, and state surcharges and cesses, these nine states are merged into GST.

The method of declared ‘goods of special importance‘ is dropped. For the inter-state transactions of the goods and services, an “Integrated GST” will be levied.

The upper limit for the exception from levy of GST would be 20 Lakh rupees for the normal states and 10 lakh rupees for the special category states.

The upper limit for getting the composition would be 50 lakh rupees with the service providers kept out of it. States to get compensation for five years for loss of revenue due to implementation of Goods and Services Tax ( for the base year will be 2015-16) with a growth rate of 14%.

Small amendments in rules may be allowed with the approval of the chairperson if required. All exemptions/incentives on indirect taxes will rest withdrawn with an obligation to pay GST. If any of them continue it will be administered by way of a reimbursement mechanism.

Bands of rates of good under GST shall be 5,12,18, and 28, and also there would be a category of exempt goods. Further, a cess would be levied on certain goods such as luxury cars, aerated drinks, pan masala, and tobacco products, over and above the rate of 28 per cent (for payment of compensation to the states).

Keeping in mind the structure of the federal, there will two taxes CGST(Central GST) and SGST (State GST).

Both centre and state levying GST across the value chain on every supply of goods and services. States with assess 90% of assesses with annual turnover below 1.5 crore rupees while 10% by the centre. For taxpayers with over 1.5 crore rupees turnover, the split is 50:50 between the centre and states.


We have discussed, What is GST and what are taxes subsumed under it. Kindly check the latest GST rates, as it changes regularly.

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* * All the Notes in this blog, are referred from Tamil Nadu State Board Books and Samacheer Kalvi Books. Kindly check with the original Tamil Nadu state board books and Ncert Books.
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