Under the revised draft model of the Goods and Services Tax (GST) law, there are certain cases where businesses are liable to pay GST. In this article, we will delve into these cases and provide a detailed explanation of the circumstances under which GST must be paid.
GST is a comprehensive indirect tax levied on the manufacturing, sale, and consumption of goods and services in India. It is a single tax that applies to all goods and services, with the aim of simplifying the tax system and reducing the burden on taxpayers.
According to the revised draft of the GST law, businesses are liable to pay GST in certain cases. These cases are as follows:
When a business sells goods or services from one state to another, it is considered an inter-state transaction. In such cases, the business is liable to pay GST under the Integrated GST (IGST) regime.
Under the reverse charge mechanism, the liability to pay GST is on the recipient of goods or services, rather than the supplier. This mechanism is applicable in the following cases:
E-commerce operators that facilitate the sale of goods or services through their platform are also liable to pay GST. This includes online marketplaces such as Amazon, Flipkart, and Snapdeal.
Registered dealers can claim input tax credit for GST paid on purchases made for their business. However, this credit can only be claimed if the supplier has paid the GST to the government.
Under the revised draft of the GST law, businesses are liable to pay GST in certain cases. These include inter-state transactions, the reverse charge mechanism, e-commerce operators, and input tax credit. It is important for businesses to understand these liability provisions to ensure compliance with the GST law.
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