The Benefits of GST and Its Types

Introduction

A tax may be defined as a “Business burden laid upon individuals or property owners to support the Government, a payment exacted by legislative authority”. A tax “is not a voluntary payment or donation, but an enforced contribution, exacted pursuant to legislative authority”. Taxes are in different type  they are Direct Tax or indirect Tax, and may be paid in money or as its labor equivalent (often but not always unpaid labor). India has a well developed taxation structure. Taxes are imposed by the Central Government, State Government and some minor taxes are imposed by the local authorities like Municipalities in India. The taxes is derived from the Constitution of India which allocates taxes for both the Central and the State government’s. The power of central and state government to make tax laws, which states that “No tax shall be collected except by the authority of law”. Every tax collected  based  on  accompanying law, passed either by the Parliament or the State Legislature. Any tax which is imposed by the government and is legal charges collected by the government based on law or is beyond the power of legislative authority, is struck down as unconstitutional.

Types of Taxes in India
In India various kinds of taxes are found.  In India, taxes can be either direct or indirect. However the types of taxes depend on whether it is levied by central, state or municipalities. The most known tax imposed by the local municipal authorities is the State Entry Tax

 GST Taxes

GST stands for Goods and Service Tax. The Goods and Service Tax Bill is officially known as the Constitution (One Hundred and Twenty Second Amendment Bill), 2014 which is to be implemented in India from 1st April, 2017. The purpose of this act is to merge the indirect taxes in India into a single taxation system. This is one of the most important reforms brought in Indian economic system which would affect us all. The taxes which will be submitted into GST include Central Excise Duty, Service Tax, Additional Custom Duty, and state-level Value Added Taxes.

Direct Taxes

Direct taxes are so named because they are directly paid to the union of India. Some of the direct taxes imposed by the central government are income tax, corporation tax, security transaction tax etc.

Indirect Tax

Indirect taxes are levied on some specific taxes and particular goods. It is not levied on any particular person or individual. Usually indirect taxes in Indian republic are a complex procedure that involves laws and regulations, which are interconnected to each other. Some of the indirect taxes are excise duty, custom duty, sales tax, value added tax, etc.

The Indian government introduced the  New Tax System  based on Good & Services  With the introduction of GST  tax system in India is expected to evolve. such as Pharmaceutical Sector, Textiles and Garments, IT Sector, Telecom Companies, Consumer durables, Automobiles