GST - FAQ

HOW WILL THE GST WORK?

The GST is an indirect tax that would replace existing levies such as excise duty, service tax, and value-added tax (VAT).

Both the states and the federal government would impose the tax on almost all goods and services produced in India or imported. Exports would not be subject to GST.

For the first two years of operation, the proposal is for two rates both at the central and state levels, converging to a single rate in the third year.

Producers would receive credits for tax paid earlier, which would eliminate multiple taxation on the same product or service.

Direct taxes, such as income tax, corporate tax and capital gains tax would not be affected.



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