Which are indirect taxes in india

Indirect tax is considered to be an easy-to-collect and convenient taxation as they originate largely from the organized sector.

However, indirect taxes have a wider reach as it involves every consumer of a product or service. It is often judged as a regressive form of taxation as it is collected in equal measure from all irrespective of their income. He is a chartered accountant and has 20 years of experience in advising clients on tax and regulatory issues. At Forbes Advisor, he is determined to help readers declutter complex financial jargons and do his bit for India's financial literacy. Select Region.

United States. United Kingdom. Advisor Tax. Published: Sep 8, , pm. Vikas Vasal Contributor. Armaan Joshi Editor. Editorial Note: Forbes Advisor may earn a commission on sales made from partner links on this page, but that doesn't affect our editors' opinions or evaluations. Dual structure levy The GST has a dual structure regime as the Centre, States, and Union Territories can simultaneously levy it on the supplies of goods and services.

Integrated GST IGST : It is levied on all taxable supplies between the two states or union territories and the export or import of goods and services from and to India. However, as per the arrangement, the share of the state will be passed on to the states where goods or services have been consumed. Compensation Cess: It is levied on specified supplies to compensate the states for the loss of revenue on account of implementation of GST. Taxable event GST fundamentally deals with the supply of goods and services.

The various type of supply under GST is as below: Intra-state supply: Location of supplier and place of supply of goods or services are within the same state or union territory.

Inter-state supply: Location of supplier and place of supply of goods or services are with different states or union territories. Also, the export of goods here means transporting goods out of India.

While some specified essential items are exempted under GST, the demerit or luxury goods attract the highest rate of tax and may invite cess. When it comes to zero-rated supply, tax payment is optional for the supplier of goods or services. A registered individual may supply goods, services, or both without paying the integrated tax on furnishing bonds or letter of undertaking LOU. Also, the GST Council has proposed to implement a procedure to electronically obtain pre-authentication of invoices through the allocation of an electronic invoice reference number for all B2B supplies with effect from 1 January Yes, there are certain notified supplies of goods and services where the recipient is liable to pay GST under the reverse charge mechanism.

Further, the GST legislation prescribes tax withholding tax deducted at source and tax collection at source. The provisions for tax collection at source are applicable to electronic commerce operators and the provisions for tax deducted at source are applicable to supplies to government establishments.

Is it possible to apply for formal or informal advance rulings from the tax authority? Yes, only the facility to obtain a formal advance ruling is available, subject to certain conditions being fulfilled. All information within this guide is provided by KPMG professionals in India and based on information available as of September Request for proposal. Gain access to personalized content based on your interests by signing up today.

Browse articles, set up your interests , or Learn more. You've been a member since. KPMG Personalization. Get the latest KPMG thought leadership directly to your individual personalized dashboard. Register now Login. Close Notice of updates! Since the last time you logged in our privacy statement has been updated. We want to ensure that you are kept up to date with any changes and as such would ask that you take a moment to review the changes.

You will not continue to receive KPMG subscriptions until you accept the changes. Close Hi! Our privacy policy has been updated since the last time you logged in. We want to make sure you're kept up to date. Please take a moment to review these changes. Our representative will get in touch with you shortly. Updated on : Oct 04, - PM. Tax is a mandatory fee imposed upon individuals or corporations by the Central and the State Government to help build the economy of a country by meeting various public expenses.

Taxes are broadly divided into two categories- Direct and Indirect taxes. It is a tax levied directly on a taxpayer who pays it to the Government and cannot pass it on to someone else. To name a few,. Direct taxes come with a handful of disadvantages.

But, the very time-consuming procedures of filing tax returns is a taxing task itself. It is a tax levied by the Government on goods and services and not on the income, profit or revenue of an individual and it can be shifted from one taxpayer to another.