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GST THE NEW FISCAL BABY

Date of Birth

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GST THE NEW FISCAL BABY

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    1. GST THE NEW FISCAL BABY

    2. Date of Birth GST when ? Agreement between Centre & States - consummated long back Baby Christened affectionately as GST Date of Delivery announced is 1.4.2011 Hope the Baby is not Premature

    3. Date of Birth GST when ? No harm in delaying the process Even 1.4.2012 acceptable Healthy Baby should be promised Lawyers to do the role of Doctors Empowered Committee to be the MEDICAL CONSULTANT

    4. POSITIVE ASPECTS OF GST

    5. POSITIVE ASPECTS OF GST

    6. Implications for a Manufacturer Excise (GST) extended to retail level Value addition on the distributive trade below the manufacturing level covered States to levy and collect Service Tax

    7. Basics What is GST? - Tax on Goods & Services Taxable event - Supply of Goods - Supply of Services Taxable - When supply made for consideration

    8. INCIDENCE OF TAXATION A PARADIGM SHIFT Supply is the basis Manufacture / Sale No longer relevant

    9. WHAT IS SUPPLY ? Provision of what is needed is supply Is transfer of possession supply? Is consideration mandatory (will it include monetary/ otherwise) Is transfer of title not required for Goods ?

    10. WHAT IS GOODS ? Will it include both Tangible and Intangible ? Whether property (Immovable) will be called as Goods?

    11. WHAT IS SERVICE ? No definition even under the current law

    12. RELEVANCE? FACTORY TIME PLACE OF REMOVAL MOVEMENT OF GOODS DELIVERY OF GOODS RECEIPT OF CONSIDERATION

    13. STOCK TRANSFERS Whether Stock Transfers are supplies ? Basis for Valuation ? Relevance of Greatest Aggregate Quantity ? Notional Value ? Value at which goods are ordinarily sold

    14. INTER UNIT TRANSFERS (FOR CONSUMPTION) Inter Unit Transfers - Taxability ? Valuation CAS4 ?

    15. DEEMED SALE (Lease etc.) Whether supplies ?? Valuation Notional basis ?

    16. JOB WORK : IS IT A SERVICE UNDER GST ? Activities of a Job Worker Manufacture or Service? Goods used by the Job worker for the supply? PRINCIPAL JOB WORKER PRINCIPAL PRINCIPAL JOB WORKER CUSTOMER PRINCIPAL JOB WORKER DEPOT CUSTOMER Valuation Provisions / Credit entitlement ?

    17. ISSUES : (MORE CLARITY REQUIRED?) Basic features Chargeability, Definition of Taxable Event, Taxable Person, Measurement of Levy, Valuation Provisions, Classification uniform amongst the States as far as possible Whether Auto Cess would be subsumed ? Whether R&D Cess would be subsumed ?

    18. Status of Supplies to 100% EOU ? Excise exemption to Infrastructure Projects ? Whether LTU will continue ? will only CGST/IGST be covered or SGST also ? Relevance of MRP ? ISSUES : (MORE CLARITY REQUIRED?)

    19. Will there be a common Appellate Forum ? Need for a clear definition of Input / Output Service Eligibility if the activities are related to business No restrictions Registration Utility-wise or Factory wise whether Inside the State and or Outside the State ? ISSUES : (MORE CLARITY REQUIRED?)

    20. Tax payment from Head Office ? Transition arrangement ensuring full availability of transitional credit ISSUES : (MORE CLARITY REQUIRED?)

    21. EXPORT AND GST GST do not make any major difference Irritants like Entry Tax may be removed Exemption Vs Refunds (Rebate / LUT / Bond) to continue Applicability of GST on Supplies to SEZ from DTA ?

    22. IGST ISSUES Place of Supply : Onus is on the supplier to identify the location of the recipient Thereafter to decide whether to charge IGST or SGST/CGST

    23. IGST ISSUES Seller in Karnataka Buyers factory in Andhra Buyers Head Office in Karnataka (Invoice raised on Karnataka) Transaction between Karnataka / Andhra Whether transaction in Karnataka subject to IGST or SGST ? Suppose the invoice is raised on HO (Karnataka) and tax applicability between HO and Factory ?

    24. IGST ISSUES Seller in Karnataka Buyers factory in Andhra Buyers Head Office in Tamil Nadu (Invoice raised on Tamil Nadu) Whether IGST Credit can be taken in Andhra Pradesh/ Tamil Nadu Whether any tax applicable on transaction between Head Office and Factory How IGST can be transferred ?.....

    25. IGST ISSUES Dealer (1) in Tamil Nadu buys from Dealer (2) in Karnataka Dealer (2) raises invoice on Dealer (1) Dealer (2) in Karnataka delivers the goods to Dealer (3) in Karnataka Dealer (1) in Tamil Nadu raises invoice on Dealer (3) in Karnataka How IGST will solve the issue ?

    26. CWP manufactured (Ennore) Tamil Nadu, moved to Bhandara (Nagpur) Maharashtra for fitment in Gear Box: Gear box moved to Alwar (Rajasthan) for use in vehicle which is stock transferred to Delhi for Sale to DTC Engine manufactured at Hosur sent to R&D Centre in Tamil Nadu, then moved to UTK for fitment in Vehicle which is stock transferred to Madhyapradesh Depot for Sale Chassis moved from AL, Ennore to Sembarambakkam Depot- subsequently stock transferred to Vijayawada (RSO) to Pune (RSO), to Bangalore RSO for sale to KSRTC Movement of Goods and Service For a Manufacturer having multi-unit set up- GST IMPLICATIONS

    27. Movement of Goods and Service For a Manufacturer having multi-unit set up- GST IMPLICATIONS Chassis at Hosur (TN), moved to Karnataka ( for fitment of subframe and tipping gear), moved to Mumbai (for body building) Fully Built Vehicles moved to Mumbai (RSO) Part qty sold to BEST (Part quantity exported) Chassis at Ennore moved to Body Builder (Karnataka), brought back to Ennore, and fully built vehicle invoiced from the factory to projects with or without tax ( if exemption continues) Materials (Engines) imported and stored in Chennai (in godown) at Ambattur (registered), part quantity transferred to Ambattur factory for use in DG Set, part quantity sold to customer

    28. Movement of Goods and Service For a Manufacturer having multi-unit set up- GST IMPLICATIONS Steel imported in bulk and sent to job workers for further operations and resultant products distributed from the job workers premises to different units of the company Tools / Dies manufactured by the component manufacturer on behalf of the principal manufacturer and retained in the premises of component manufacturer; Components supplied to the main manufacturer. Cylinder Block / Cylinder Head (Forgings) procured by LML, Hyderabad from a supplier in Hyderabad. After part machining sent to Ennore for further manufacture (finished) used captively or transferred to other units or sold as spares (within TN / outside TN)

    29. Treatment for supply / credit availment Inputs & Capital Goods before use and after use including Waste & Scrap Movement of Goods and Service For a Manufacturer having multi-unit set up- GST IMPLICATIONS

    30. Wish List Uninterrupted ITC throughout the supply chain SUPPLY Rules to be framed without any ambiguity Uniform provisions of Valuation To cover Sale, Job Work, Captive Consumption, Stock Transfers IGST Rules to be framed comprehensively to suit the business exigencies Timely refunds Transaction cost to be minimal Job worker provisions (without ambiguity)

    31. Action Points Unlearn whatever has been learnt Update Knowledge on GST continuously Travel on GST Road

    32. Conclusion TAXING TIMES AHEAD THANK U

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