Goods and Services Tax GST is the next logical step towards comprehensive indirect tax reforms in th...........

Indian Economic System(PCS) Budgeting and Fiscal policy

Goods and Services Tax (GST) is the next logical step towards comprehensive indirect tax reforms in the country. Consider the following statements with respect to GST :

With the introduction of GST, the burden of Central Sales Tax (CST) will be removed.
For introduction of GST at State level, States should be given the power to levy tax on services. Which of the above statements is/are true?

This questions was previously asked in

PCS Previous year General Studies paper (2013)

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Only 1

Only 2

Both 1 and 2

Neither 1 nor 2

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Explanation:

GST is an Indirect Tax which has replaced many Indirect Taxes in India. The Goods and Service Tax Act was passed in the Parliament on 29th March 2017. GST has mainly removed the Cascading effect on the sale of goods and services. Removal of cascading effect has impacted the cost of goods. Since the GST regime eliminates the tax on tax, the cost of goods decreases. GST is also mainly technologically driven. All activities like registration, return filing, application for refund and response to notice needs to be done online on the GST Portal; this accelerates the processes.