The GST (Goods and Services Tax) is an indirect tax levied on the sale of goods and services. The tax is included in the final price and is paid at the time of sale by customers, with the proceeds going to the government.
Why is a GST Certificate Necessary?
A GST certificate is necessary for anyone seeking to undertake the supply of goods and services across states while maintaining an annual aggregate turnover that exceeds INR 40 lakhs/20 Lakhs as the case may be. A person without a GST number, can neither claim GST from his/her customers nor can he/she claim any input tax credit.
According to Section 122 of the CGST Act, any taxable person who fails to register under GST, even though he or she is legally obligated by the GST Act, must pay the following penalty: whichever is greater: 10,000 INR or the amount of tax evaded
To download GST certificate, follow the steps given below.
- Step 1: Open the GST India portal https://www.gst.gov.in/
- Step 2: To access the username and password, click the ‘Login’ option.
- Step 3: Enter the login credentials along with the captcha and proceed
- Step 4: Select Services –> User Services –> View/ Download Certificate from the drop-down menu.
- Step 5: To download the certificate, click the ‘Download’ option on the screen.
Pros and cons of getting a GST certificate
The advantages of the GST certificate are given below.
- GST eliminates the cascading effect of tax, by bringing indirect taxation under one umbrella.
- Higher threshold for registration: Under the GST regime threshold has been increased to Rs 20 lakh, which exempts small traders and service providers.
- Improved efficiency of logistics. It further reduced logistic costs by eliminating border taxes and resolving check-post discrepancies.
- Businesses can claim an input tax credit for taxes paid on gains as well as taxes paid on the supply of goods or services.
- At the national level, uninterrupted movement of the input tax credit from dealers to receivers..
The disadvantages of GST are given below.
- Increased cost due to software purchase which has led to higher operational cost
- Insurance premium has become more expensive with GST.
- GST can be a burden to low-income groups’ facilities during times of high inflation. 7% tax is paid on the increasing price of daily essentials.
- The disadvantage of GST registration is an administrative burden that comes with discharging the duties and responsibilities of GST registration.
- One must either study the intricacies of GST or pay an accountant to undertake this work which in some cases can be a reasonably high cost.
If you are still confused whether you should get a GST certificate or not you can find some great in-depth analysis on GST by experts at Khatabook.
Goods and Service Tax is the biggest transformation in the taxation system of India. India plays an important role in the Global Market. GST gives businesses a better opportunity for implementation of Business Strategies. GST is supposed to bring state economies together and boost the country’s overall economic growth. Furthermore, GST is included in the MRP. This maintains pricing transparency by removing many taxes that were previously added to MRP.