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Question 1. How would a
particular transaction of goods and services be taxed simultaneously under
Central GST (CGST) and State GST (SGST)?
Answer : The Central GST and the State GST would be
levied
simultaneously on every transaction of supply of goods
and services except on exempted goods and services, goods which are outside the
purview of GST and the transactions which are below the prescribed threshold
limits. Further, both would be levied on the same price or value unlike State
VAT which is levied on the value of the goods inclusive of Central Excise.
A diagrammatic
representation of the working of the Dual GST model within a State is shown in
Figure 1 below.
Question 2.
Will cross utilization of credits between goods and services be allowed
under GST regime?
Answer: Cross utilization of credit of CGST between goods
and services would be allowed. Similarly, the facility of cross utilization of
credit will be available in case of SGST. However, the cross utilization of
CGST and SGST would not be allowed except in the case of inter-State supply of
goods and services under the IGST model which is explained in answer to the
next question.
Question 3. How will be
Inter-State Transactions of Goods and Services be taxed under GST in terms of
IGST method?
Answer: In case of inter-State
transactions, the Centre would levy and collect the Integrated Goods and
Services Tax (IGST) on all inter-State supplies of goods and services under
Article 269A (1) of the Constitution. The IGST would roughly be equal to CGST
plus SGST. The IGST mechanism has been designed to ensure seamless flow of
input tax credit from one State to another. The inter-State seller would pay
IGST on the sale of his goods to the Central Government after adjusting credit
of IGST, CGST and SGST on his purchases (in that order). The exporting State
will transfer to the Centre the credit of SGST used in payment of IGST. The
importing dealer will claim credit of IGST while discharging his output tax
liability (both CGST and SGST) in his own State. The Centre will transfer to
the importing State the credit of IGST used in payment of SGST. Since GST is a
destination-based tax, all SGST on the final product will ordinarily accrue to
the consuming State.
A diagrammatic representation
of the working of the IGST model for inter-State transactions is shown in
Figure 2 below.
Question 4. What is the format of
Provisional ID?
|
Format of
Provisional ID |
|
|
22 |
AAAAA0000A 1 |
M |
5 |
|
'-------- '------- ' y |
y |
Y |
State Code |
Permanent Account Number
(PAN) Entity number of |
Alphabet 'Z'by default |
Check sum
digit |
|
the same DAM
hnUor |
||
|
kan noiaer in a state |
|
|
Question 5. What is ARN? What is the
format of ARN?
ARN refers to Application Reference Number. It is a unique
number assigned to each transaction completed at the GST Common Portal. It will
also be generated on submission of the Enrolment Application that is
electronically signed using DSC. ARN can be used for future correspondence with
GSTN.
Format of ARN
AA 07 07 16 000000 1
•nr1 V V V 1---------------------- 1------ 1 Y
Alphabets State
Code Month Year
Six digit-System generated code Check sum digit
Miscellaneous
1. I have multiple businesses in
one state registered using the same PAN. Do I need to enrol each business
separately with GST?
As one PAN allows one GST
Registration in a State, you may register one business entity first. For the
remaining business within the State please get in touch with your
Jurisdictional Authority.
2. What is ISD Registration?
ISD stands for Input Service Distributor. An Input
Service Distributor refers to a person who distributes credit, in respect of
the tax invoices of the services received at the Head Office, to its branches
where the services have been supplied actually. Tax invoice refers to the
invoice issued under Section 23 of the Model Goods and Services Act.
If you are an existing ISD Taxpayer, you need to apply
afresh in the GST Common Portal for the State in which you desire to seek
registration. For that you need to inform your Central Jurisdictional
Authority.