GST stands for Goods and Services Tax, which is a value-added tax levied on the supply of goods and services in India. It is an indirect tax that was implemented in India on July 1, 2017, to replace a range of indirect taxes levied by the central and state governments.
Under GST, all goods and services are classified into different tax slabs based on their nature, and a standard set of rates is applied to them. The current GST structure in India includes four tax slabs of 5%, 12%, 18%, and 28%, along with a special rate of 0.25% for rough precious and semi-precious stones and 3% for gold.
GST is a destination-based tax, which means that the tax revenue is collected by the state where the final consumption takes place. This helps to eliminate the cascading effect of taxes and ensures that the tax burden is shared by the entire supply chain, from manufacturers to retailers.
GST has brought about several benefits for businesses, such as increased compliance, a simplified tax structure, and a reduction in the tax burden. It has also helped to streamline the logistics and supply chain management, making it easier for businesses to operate across state borders.