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Goods and service tax is taking India by the storm. GST will bring in One nation one tax to unite
indirect taxes under one umbrella and facilitate Indian businesses to be globally competitive. The Indian
GST case is structured for efficient tax collection, reduction in corruption, easy inter-state movement of
goods etc.
France was the first country to implement GST to reduce tax- evasion. Since then, more than 140
countries have implemented GST with some countries having Dual-GST (e.g. Brazil, Canada etc.) model.
India has chosen the Canadian model of dual GST.
Name of GST Goods and Service tax Federal Goods and Value Added Tax
in the country Service Tax &
Harmonized Sales Tax
Liability arises Accrual basis: Issue of Accrual basis: The date Accrual Basis: Invoice OR
on invoice OR of issue of invoice OR the Payment
Receipt of payment date of receipt OR Supply
-earlier of payment- earlier. -earliest
Cash basis (T/O upto
1.35mn): Payment
Particulars India (proposed) Canada UK
Returns and Monthly and 1 annual Monthly, quarterly or Usually quarterly. Small
payments return annually based on business option- annual
turnover
Name of GST Goods and Service tax Goods and Service Tax Goods And Services Tax
in the country
Liability arises Accrual basis: Issue of Accrual Basis: Issue of Accrual Basis: Delivery of
on invoice OR invoice OR Receipt of goods OR Issue of invoice
Receipt of payment payment OR Supply - OR Receipt of payment
-earlier earliest
Cash basis:(T/O upto
Particulars India (proposed) Canada UK
SGD$1mn): Payment
Reverse Apply on goods (new) as Reverse charge applies Reverse charge applies to
charge well as services to supply of services imported services
Mechanism (currently under Service
tax)
**USA does not have GST as it ensures high autonomy for the states**
Thus we find GST model across the commonwealth countries are similar with some variations. Unlike
India, other countries have a much higher threshold for GST applicability thus reducing the burden for
small businesses. This will bring in challenges for our SMEs.
Earlier countries implemented GST and faced many problems post-implementation. Readhere to find
out more.
Are you worried about how GST will impact your business? Register with us at Clear Tax to keep yourself
up to date on GST. We also have experts to help you to smoothly transit to GST.