History of GST in India

The implementation of the Goods and Services Tax in India was a historical move, as it
marked a significant indirect tax reform in the country. The amalgamation of a large number
of taxes levied at a central and state level into a single tax is expected to have big advantages.

The framework of the tax reform was formed 17 years ago during Atal Bihari Vajpayee
government. The tax reform is now being taken over by the Modi government marking some
historical moves.

THE PHASES OF GST

1. In 2000, Atal Bihari Vajpayee formed a committee for review on GST under the
chairmanship of then finance minister Asim Dasgupta of West Bengal, in which he
was given the responsibility of preparing the complete model of GST.

2. The Kelkar Task Force advised to unify indirect taxes in the form of GST.

3. The proposed national level GST was first placed during the 2006 budget speech.

4. In May 2007, an Empowered Committee of Finance Ministers was constituted to

know the impact of GST and the implementation of GST.

5. In 2008-09, Kelkar Task Force gave a report on the draft of GST called 'A Model and
Roadmap for GST in India' and the first discussion was done after the arrival of this
report in November.

6. In 2010, Finance Minister P Chidambaram had announced in his speech that GST will
be implemented from April, 2011.

7. In 2011, the 115th Constitution Amendment Bill was introduced for the levy of GST
on all goods and services in the Lok Sabha.
8. In 2013, the Standing Committee presented its report on GST

9. In 2014, 122th Constitution Amendment was passed in the Lok Sabha.

10. After two years of waiting, Rajya Sabha passed the GST on August 3, 2016 and
received President's approval in September 2016.

11. On September 22, 2016 GST Council was formed. This council will decide on tax rate
for the new indirect tax system, the exemption given in it and its limits.

12. On September 23, 2016, GST Network was formed, it is an online network designed
to solve the problems and questions of consumers and businessmen.

13. In 2017, the government introduced four types of GST bills, including Central GST,
Integrated GST, GST Bill of Union Territories and GST Bill.

14. On May 20, the GST Council fixed four rates of GST (5%, 12%, 18%, 24%).

15. The launch of GST was announced in May 2017.

16. On June 20, 2017, Arun Jaitley announced that GST will be launched on the lines of
the night of Independence, on the midnight of June 30.
Difference between CGST, SGST and IGST

CGST that is designed to replace the taxes that would have been applicable directly to the
central government. ‘SGST’ which replaces those taxes that would have been levied and
collected by the state and finally IGST which is the combination of CGST and SGST.

CGST and SGST are applicable within the state while IGST is applicable in the course of
interstate trade and commerce.
 Central GST State GST Integrated GST

It is levied by Central It is levied by State

It is a combined form of
government to replace government to replace
CGST and SGST levied
Meaning the existing tax like the existing tax like
and collected by Central
service tax, excise, sales tax, luxury tax,
government.
etc entry tax, etc.

Technically this is
country wide but it
would be against the When trading within When there is an
Applicability
state as it relates to the same state interstate supply
buying in and out of
that state.

The credit of SGST is

The credit of CGST, is The credit of IGST is
Input Tax available only
available only against available against
Credit against SGST and
CGST and IGST CGST, SGST and IGST.
IGST

Who
collects the Central Government State Government Central Government
tax?