How is GST helpful for a retailer?
GST ensures single tax for all goods and services. With a retailer or wholesaler not having to pay separate taxes for state and central governments, the prices of commodities and services would remain under check.
Also the retailer or shopkeeper at the last mile will now generate bill as it would help him avail tax credits, something which was not possible with the existing taxation system. With refunds his cost of purchase comes down which he can easily pass on to the consumer.
The Goods and Services Tax (GST) is a tax levied on the manufacture and sale of goods and services. It is an inclusive tax and has replaced a number of other indirect taxes that were applicable in India.
The GST includes two components:
Central GST which is levied by the Centre.
State GST which is levied by the State.
The GST is a unified taxation system that includes all indirect taxes under one tax. The GST has reduced the differences that arose because of inter-state variations in taxes.
Which are the taxes that GST has replaced?
All taxes including the Central Excise Duty, Service Tax, Special Additional Duty of Customs (SAD) and cesses & surcharges for supply of goods and services, has been replaced by GST. The GST has absorbed other taxes like Value Added Tax (VAT), Central Sales Tax (CST), Purchase Tax, Luxury Tax and Entertainment Tax, among others.
Also, GST is helping reduce logistics and distribution costs, which might ultimately result in lower prices for goods and services. GST is helping create an integrated market across the country in case of e-commerce. This will benefit retailers. In this context, GST has eliminated the snowballing effect of taxes in case of goods sold through e-commerce.
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