a    tr  t re in ndia     17.7
          (i) The central taxes subsumed in it are—                  it will be administered by way of a
              central excise duty (cenvat); additional               reimbursement mechanism.
              excise duty; service tax; additional customs     (xi) Bands of rates (in per cent) of goods
              duty (commonly known as countervailing                 under GST shall be 5, 12, 18 and 28 and
              duty; and special additional duty of                   in addition there would be a category of
              customs (total 5 taxes).                               exempt goods. Further, a cess would be
         (ii) The state taxes subsumed in it are—state               levied on certain goods such as luxury cars,
              vat; entertainment tax (other than the tax             aerated drinks, pan masala and tobacco
              levied by the local bodies); central sales             products, over and above the rate of 28
              tax (levied by the centre and collected by             per cent (for payment of compensation
              the states); octroi and entry tax; purchase            to the States).
              tax; luxury tax; and taxes on lottery,          (xii) Keeping in mind the federal structure of
              betting and gambling (total 8 taxes).                  India, there will be two components of
        (iii) Concept of ‘declared goods of special                  GST—Central GST (CGST) and State
              importance’ dropped.                                   GST (SGST)—both Centre and States
        (iv) On inter-state transactions of goods and                levying GST across the value chain on
              services an Integrated GST will be levied.             every supply of goods and services. States
         (v) Exception from GST on alcoholic liquor                  will assess 90 per cent of assessees with
              for human consumption, petroleum and                   annual turnover below Rs. 1.5 crore while
              petroleum products (on latter it will be               remaining 10 per cent by the centre. For
              imposed on a later date).                              taxpayers with over Rs. 1.5 core turnover,
        (vi) The threshold limit for exemption from                  the split is 50:50 between the centre and
              levy of GST would be Rs. 20 lakhs for                  states.
              normal States and Rs. 10 lakhs for the            After the GST was enforced a state of
              Special Category States.                     confusion was seen due to several reasons—related
       (vii) The threshold for availing the                to tax rates, complexity of compliance process,
              Composition scheme would be Rs. 50           complaints of businesses and trading bodies,
              lakhs—with the Service providers kept        etc. The tax being fully online, certain level of
              out of it.                                   dissatisfaction was seen in the area of unawareness
      (viii) States to get compensation for 5 years for    and lack of IT services also. Experts believe that
              loss of revenue due to implementation of     in coming times these concerns will be resolved
              GST (for this base year will be 2015-16      and a new era of federal indirect tax regime will
              with growth rate of 14 per cent).            commence in the country.
        (ix) Minor changes in rules and regulations
              may be permitted with the approval           unDerstAnDing the economy through gst
              of the Chairperson, if required (due to      The GST has been widely heralded for many
              suggestions from the stakeholders or         things, especially its potential to create one
              from the Law Department).                    Indian market, expand the tax base, and foster
         (x) All exemptions/incentives on indirect         cooperative federalism. Yet almost unnoticed is
              taxes will rest withdrawn with obligation    its one enormous benefit—it will create a vast
              to pay GST. If any of them continue          repository of information, which will enlarge and