Department of State Taxes Government of Nagaland BRIEF OVERVIEW OF GST WITH SPECIAL REFERENCE TO TDS under GST Dated October 13, 2017

What is GST? Means Goods and Services Tax. GST subsumed all indirect taxes (Central and State) and integrate them into single system It is a tax levied on goods and services at every stages of supply on the basis of value addition. It provides a comprehensive ITC through out the entire supply chain across India It mitigate cascading of taxes; and It make the country as one single common market

Benefits of GST Replaces multiplicity of Tax Acts, Rules and Rates and promotes “Ease of Going Business” in India Provides set-off of taxes paid through ITC and mitigate cascading of tax. Overall tax burden on goods and services would decrease, benefitting common man. Make our products more competitive both in domestic as well as in international markets. It will boost economic activity and create more jobs.

GST in Nagaland Introduction and implementation with effect from July 1, 2017 GST is a tax on supply of Goods and Services on value addition basis GST has subsumed all indirect State taxes in the state Taxes subsumed in the state are VAT (except potable alcohol for human consumption), CST, NPT (Except Crude Oil, MS, Diesel, Natural Gas, ATF) NAT, and NET

Facts about GST for guidance and references by DDOs; GST is administered broadly under three Acts the Central GST, is administered and collected by the Centre under the CGST Act, 2017 the State GST (SGST) is administered and collected by State under the SGST Act, 2017, and the Integrated GST (IGST) is levied and collected by the Centre and transfers the same to the consuming state under the IGST Act, 2017. GST is a destination based tax and the taxes collected are credited/ transferred to the state where the goods or services or both are eventually consumed

GST is a destination based tax Type of tax (whether CGST/SGST or IGST) is to be correctly recorded in the tax invoice. Supplier GSTIN, State code (State code of Nagaland is “13”) and the GSTIN or address of the Recipient in case of inter-state supplies Otherwise, the tax so paid, in all likelihood, will be retained by the supplier’s state; and The consuming (recipient) state like Nagaland, in all probability, will loss the revenue.

Cross-empowerment under all three Acts To facilitate single interface for the taxpayers CGST and SGST are levied on intra-state taxable supplies where the supplier and place of supply (recipient) is in the same State. IGST is levied and on inter-state taxable supplies where supplier and place of supply (recipient) is in different States

Tax invoice A registered person supplying taxable goods issue a tax invoice showing the description, quantity and value of goods, the tax charged thereon and such other particulars as may be prescribed; Government may, by notification and subject to such conditions as may be mentioned therein, specify the categories of services in respect of which any other document issued in relation to the supply shall be deemed to be a tax invoice; 3. Tax invoice is the document or the basis upon which the GST paid is transferred to the destination state (where the goods or services are finally consumed).

Compulsory Registration for TDS Section 24(VI) of Centre/State GST Act, 2017 and Section 20(10) of IGST Act, 2017 mandates that persons who are required to deduct tax under section 51, whether or not separately registered under this Act; shall be required to be registered under this Provision.

TDS under Nagaland GST Act, 2017 Under section 51(1) Government may mandate,- (a) a department or establishment of the Central Government or State Government; or (b) local authority; or (c) Governmental agencies; or (d) such persons or category of persons as may be notified by the Government

TDS Threshold Limit under GST The TDS shall be applicable only where the total value of such supply, under a contract, exceeds Rs2.50 lakhs The total value of supply shall be the value of invoice for which payment is being made after excluding all the tax/cess components of GST. Supply of service includes works contract as works contract is defined as a composite service under the Nagaland NGST Act, 2017.

Rates of tax to be deducted at source by the DDOs TDS is to be deducted on supply of taxable goods and services or both from the payment made or credited to the supplier Intra-state supplies- @ 2% (1% as CGST +1% as SGST) Inter-state supplies- @ 2% as IGST (CGST+SGST)

Responsibilities of the DDOs Contract or agreement for supply of goods or services or both to be awarded only to registered dealer holding valid GSTIN; Before making any payment ensure that the tax invoices bears all relevant details (Suppliers’ GSTIN, Type of tax, State code and GSTIN or address of the recipient) The Invoice bears Serial number, Date and Value An undertaking prescribed by Commissioner of Taxes issued vide office letter No.CT/GST-C/160/2016 dated 11.8.2017 to be obtained from the supplier; and Forward the undertaking to Commissioner’s official email id: cotgon@rediffmail.com

Departments like Transport are to take extra care of this fact and caused all necessary steps to ensure that No vehicle purchased (be it by Gov.t deptts or by individual consumer from Nagaland) from outside the state are given registration certificate in the state unless;- The tax invoice, inter alia, bears the suppliers' GSTIN, Type of tax as “IGST” with our state code as “13” and GSTIN or proper address of the buyer So as to protect and secure the revenue of the state

Registration window for applying GSTIN is already available in the GST portal All concern are impress upon to cause to obtain; i. Tax Deduction and Collection Account Number (TAN) from Income Tax department; ii. Department’s official email id forthwith; and iii. DDOs’ has valid Mobile no., PAN from Income Tax department, and PAN-linked Class II or III DSC from authorized certifying authorities The date from which the provision of TDS under GST is to be made operative shall be informed in due course of time

Implementation of the relevant provisions of TDS under GST is deferred till 31st March, 2017 For supply or contracts made or executed after July 1, 2017 DDOs’ shall have to release the entire payment to the suppliers/contractors without deducting any TDS 2 For supplies or contract made or executed before July 1, 2017 DDOs shall continue to deduct the TDS under the earlier law i.e., VAT Act even if payment is made after 30th June 2017 3 For ongoing supplies or works contract only the supplies made or works executed after 1st July, 2017, shall be governed under the GST Act

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