GS paper 3
Syllabus: GST, GST council etc
Directions: Read about GST, GST council and slabs of GST etc
Context:
- The Supreme Court has directed the Union of India/GST Council to issue an advisory to States regarding implementation of the system of electronic (digital) generation of a Document Identification Number (DIN) in indirect tax administration.
- The States of Kerala and Karnataka have already implemented it.
- The court noted that the Center had taken a decision and as such had implemented the DIN system of Central Board of Direct Taxes and on and from October 1, 2019 as every CBDT communication would have to have a DIN.
Key Highlights:
- Implement the system for electronic (digital) generation of a DIN: A Bench led by Justice M.R. Shah further impressed upon the States “to consider to implement the system for electronic (digital) generation of a DIN for all communications sent by the State tax officers to taxpayers and other persons concerned so as to bring in transparency and accountability in the indirect tax administration at the earliest.
- Directions to GST Council: The petition had sought a direction to the GST Council to consider and take a policy decision in respect of implementation of the DIN system by States.
- In view of the implementation of the GST and as per Article 279A of the Constitution, the GST Council was empowered to make recommendations to the States on any matter relating to GST.
- Prevent any abuse by the departmental officers: Implementing a system for electronic (digital) generation of a DIN would prevent any abuse by the departmental officers of pre-dating communications and ratifying actions by authorisations subsequently made out in the files.
Insta Link:
Practice Questions:
Q. Explain the rationale behind the Goods and Services Tax(Compensation to states)act of 2017.How has COVID-19 impacted the GST compensation fund and created new federal tensions?(UPSC 2020)
What is/are the most likely advantages of implementing ‘Goods and Services Tax (GST)’?
- It will replace multiple taxes collected by multiple authorities and will thus create a single market in India.
- It will drastically reduce the ‘Current Account Deficit’ of India and will enable it to increase its foreign exchange reserves.
- It will enormously increase the growth and size of the economy of India and will enable it to overtake China in the near future. (UPSC 2017)
Select the correct answer using the code given below:
(a) 1 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3
Ans: (a)
Justification:
- GST is based on the principle of destination-based consumption taxation.
- It will replace multiple taxes collected by multiple authorities and will thus create a single market in India.
- GST is unlikely to ‘drastically’ reduce Current Account Deficit because of crude oil import and OPEC cartel that manipulates its prices.
- GST is unlikely to enormously increase the size of our economy because the IMF projection is ~1-1.5% addition in growth rate. We can’t overtake China in near future, because it’ll require currency undervaluation and labour exploitation
