What is Goods and Services Tax (GST)?
GST, or Goods and Services Tax, is a single tax that people pay when they buy goods (like clothes, electronics, groceries) or services (like eating at a restaurant, booking a hotel, or getting a haircut). Before GST, there were many different taxes like VAT, service tax, and excise duty, which made the system complicated and costly. GST was introduced in India on July 1, 2017, to simplify things. Now, instead of paying many taxes at different stages, we pay just one tax – GST. This tax is added to the price of the product or service, and the final consumer (you and me) pays it when we make a purchase.
There are different types of GST in India such as:
(i) Central Goods and Services Tax (CGST),
(ii) State Goods and Services Tax (SGST),
(iii) Integrated Goods and Services Tax (IGST), and
(iv) Union Territory Goods and Services Tax (UTGST).