GST Full Form
The full form of GST is Goods and Services Tax. This is a general-purpose tax that is applied to both products and services. GST is a legal tax application system. GST ensures the removal of many indirect tax impositions occurring at different stages of retail and purchase. GST narrows down central and state taxes as one, removing multiple cascading of tax. Cascading happens when during distribution and retail, many taxes are superimposed, causing a surge in final price. A standard GST can be applied to attain a single uniform tax at the final point.
GST was introduced in 2017. GST is one indirect tax applied in entire India. This tax is imposed on goods as well as services. GST generates revenue for the nation. GST can be CGST, IGST, and SGST.
For example, A distributor applies a tax on products that lead to a surge in its prize. The retailer buys this product. Later, the retailer applies to tax on the product before selling it to the consumer, which again leads to a surge in the prize. Due to which there is a cascade of taxes overlapping. This leads to overall hiked prizes. GST, on the other hand, applies a single tax on final products removing the cascading.