16 November 2009
I have two questions 1.whether CGST will be applicable for all products/services or there would be separate legislation for the same which will define the scope of products / services for which CGST will be applicable? 2. Say in an IGST transaction, if the buyer sells it's finished product within the state only, in that case can the IGST be taken credit and set off against the SGST? Or to claim IGST, interstate sale is a must? Awaiting from the expert's view?
16 November 2009
From what it appears, IGST paid on your Interstate Purchase can be set off against your Local GST when you sell the product. The other state Government will transfer the IGST to Centre and Centre will credit it to your State Government. For IGST cum GST dealers,it is seamless. The Government has to still decide the formula internally of how the sharing of the IGST amount has to be done. Some states that do not have production of their own will suffer (especially those relying mainly on agricultural produce) and eventually Government has to work out compensation for them. the problem is they send most of their agricultural based manufactured tax levibale products out and would have to credit IGST to Centre. To add salt to their misery, when they Purchase from other states the manufactured product, they will have to set off the IGST. Success of this levy will hinge around how a fair and just treatment can be accorded to such states.
16 November 2009
If my understanding is right then a dealer of State A purchasing some input from State B paying IGST. The dealer is using it for manufacturing product X it's finished product for which if he buys also other input from the State A paying CGST and SGST. Then on sale of product x in State A only he can adjust against the IGST along with SGST and CGST purchase of State A. "Right", now suppose the product x which was previously exempted from excise duty if so whether CGST would attract? or the product will be brought in similar list like CE Tariff in CGST legislation?
CAclubindia
