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Taxable Event | Goods service tax

As per the indirect taxation system in India we have seen different taxable events in different indirect taxes. Sales, purchase, removal of goods, services, luxury, entertainment etc. GST or goods service tax which shall be implemented will not only reform  the whole of indirect taxation system but also will reform the regime of taxation in India.

Taxable event under Goods Service Tax

One of the crucial element witnessed under GST is the overall change in the taxable event, different altogether from the taxable events witnessed in the indirect taxes as yet. The taxable event in the  GST would be supply of goods and/or services. As defined officially Goods and Services Tax means a tax on supply of goods or services or both except taxes on supply of alcoholic liquor for human consumption. It is worth noting here that the word used is supply and not sales, hence consideration is not required for supply.

Therefore, the taxable event under the existing structure depends on the levy and are defined independently without any harmonious reference to other indirect tax legislations. GST is envisaged to be levied on all supplies of goods and services on same taxable event by both Centre and State governments. The term ‘supply’ is expected to be defined in the CGST, SGST and IGST laws being prepared in this regard. It is critical that the terms ‘supply’ is defined in the Central and State GST legislations in an identical manner to avoid the challenge of multiple taxable events at Central and State level in GST.

taxable events in present Indirect Tax Regime