Goods and Service Tax was introduced to the citizens of India in 2017. The aim of the bill was to replace all the other taxes and impose only one tax on all goods as well as services throughout the country. The tax law replaced other taxes such as service tax, value-added tax, excise duty, etc. Every business owner has to file for GST registration and then GST returns as per the law. They may have to pay a GST late fee that can be calculated from the GST late fee calculator websites available here. Business firms or individuals will be subjected to penalties if there is contempt of the law.
What are the benefits of GSTwith respect to businesses?
Here are a few reasons why you should apply for your GST number for your business as soon as possible-
- Start your business easily- Earlier it used to be difficult to start a business since there were many tax norms and every tax law had different processes in every state. With GST, anyone can easily start a business with fewer processes. The process of GST registration and filing is standardized throughout the country. This would help people in obtaining a GST number easily too.
- All in one tax law- GST is all-inclusive tax law. Businesses used to have a lot of complications in completing VAT processes since it is a state law and every state had their own rates of VAT and processes. Now, GST simplifies it all. It would replace all the extra taxes and would bring all in one law. Some of the earlier tax laws which would be taken into GST are value-added tax, entertainment tax, purchase tax, octroi and entry tax, central sales tax, service tax, excise duty, etc.
- Exemption of small businesses- According to the law, individuals or the firm that does not have a turnover of Rs. 10 Lakhs every year do not have to register for GST. Only those businesses that have an annual turnover of R 10 Lakhs to Rs. 50 lakhs will have to pay GST but that too at a lower rate. So, it is of great benefit for small businesses that do not cross the limitations. They would neither have to register nor file returns for the GST.
- Ease of doing business- Firms like computer sales or restaurants that sell the goods but provide services too have to pay two taxes namely, service tax as well as VAT. This creates confusion and makes all the processes complex since there are different rates for both the taxes. But with the implementation of GST, businesses no longer would have to go through this ordeal. There will only be one standard rate for everything in the GST.
To know more about industry-specific advantages of GST click here.
The Goods and Services Tax accommodates every extra tax law inside itself and it makes people less burdened with the paperwork and the overall processes. Any firm can log in to the online portal of GST and register themselves easily on the website and then obtain their GST number. It also helps in interstate trade as well.