An Accountant's Perspective on Goods&Service Tax in India

Abstract

The current taxation system in India is laced with multiplicity, and ambiguity. The plague of cascading effect of taxes was eradicated partially by the introduction of CENVAT (earlier MODVAT), in the year 1986 at the Central level and further with the introduction of VAT in the year 2005. Considering multiple taxes levied by the Central and State Govt. and in absence of facility to offset the incidence of one tax with another in most cases, the effect of cascading gets built into the transaction cost.