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in Goods and Service Tax (GST) by (70.0k points)

At what point of time, the tax will be levied?

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Taxable event under GST will be “supply of goods or services or both”. The incidence of tax is the foundation stone of any taxation system. It determines the point at which tax would be levied, i.e. the taxable event. The existing framework of taxable event in various statues has been resulting in litigation since decades.

Broadly, the controversies relates to issues like whether a particular transaction is a sale of goods or rendering of services or not, whether a particular process amounts to manufacture or not. The GST law resolves these issues by laying down one comprehensive taxable event, i.e. “Supply”.

GST Law, by levying tax on ‘Supply’ of goods/services, will depart from the historically understood concepts of‘taxable event’ under the State VAT Law, Excise Laws and Service Tax laws, i.e. sale, manufacture and service respectively. In the GST regime, the entire supply of goods/services will be taxed in an integrated manner, unlike the existing indirect taxes, which are charged independently either on the manufactured or sale of goods, or on the provisions of services.

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