Lost in Transition? Here’s a handy “Dictionary” related to GST jargons!

Additional Cess – A cess is a tax levied by the government over a tax for a specific purpose and for a particular period of time or till the purpose of levying the cess is achieved.

In terms of GST, the additional cess will be levied upon some goods for the first five years of GST implementation in order to meet the loss in state government taxes due to the uniformity and drop of tax rates related to demerit goods under the Goods and Service Tax (GST).

Aggregate Turnover – is the aggregate value of all taxable and non-taxable supply or export of goods or services of a person exclusive of taxes.

Capital Goods – are items which are bought and used for undertaking or developing sale or generating income for a business and items for which a person liable to pay tax has claimed input tax credit.

Cash ledger – is one of the secondary books maintained by an organization along with the general books. These books record and track transactions of all the cash accounts operated by an organization and its subdivisions, if any.

Central Goods and Services Tax (CGST) – is the central component of GST that incorporates all indirect taxes collected by the central Government and work as the revenue.

CPI – The Consumer Price Index (CPI) is a process of assessing the modifications in the prices of market basket of consumer goods and services.

Demerit goods – is an item, thing or service whose consumption is hazardous, undignified, or socially objectionable due to the apparent adverse effects on the users, i.e. Alcohol or Tobacco.

E-commerce operator – It denotes the businesses that provide an online marketplace to various vendors to vend their goods to consumers, i.e. Amazon, ebay etc.

E-sign – It stands for Electronic Signature which is an online electronic service to allow GST registered tax payers or Aadhar holdesr to sign a document digitally.

GSTIN – It stands for Goods and Services Taxpayer Identification Number which is a unique PAN-based 15-digit number provided to a taxpayer registered under the GST law in any state of India where GST is implemented. A tax payer will have to register for the GST across all the states they operate in and the GSTIN varies from state to state as a tax payer need to register himself/herself under GST law in all the states he/she operates in.

GSTN – It denotes the Goods and Services Tax Network which is a nonprofit private limited company to provide IT set-up and services to the State and Central Governments and other stakeholders for successful execution of GST.

HSN Code – It stands for the Harmonized System of Nomenclature which is a globally acknowledged process of nomenclature, categorizing and classifying goods. It is organized in a lawful and rational arrangement and ruled by explicit rules.

IGST – It stands for Integrated Goods and Services Tax which will be applicable on all interstate transactions. The Central and state government will share the revenue earned under the IGST.

ISD – It stands for Input Service Distributors which is an intermediary to manage the business of an industrialist or manufacturer of end products or output service provider i.e. corporate office of a Burger Chain.

ITC – It stands for Input Tax Credit which means that a buyer gets back the tax amount paid at the time of purchase while selling the product to a customer. The customer pays the tax as per the selling price of that specific item.

ITC ledger – it is an Input Tax Credit ledger is a type of a secondary register maintained by any organization to maintain track of the input taxes under all the components of GST, i.e CGST, SGST and IGST and the input tax credits received by the company under CGST, SGST and IGST.

SAC – The Services Accounting Code is a technique of classification to classify, organize and describe services under the Goods and State Taxes.

SGST – The State Goods and Services Tax includes all indirect taxes collected by different states of India. The tax collected under SGST is counted as the revenue of the state government.

TDS – Tax Deducted at Source is a technique of collecting income tax which needs to be recorded and tracked under the GSTR-7.