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CS Executive · Tax Laws and Practice · Concept of Indirect Taxes at a Glance

Under the GST regime in India, which statement best describes the taxable event?

The taxable event under GST is the supply of goods or services or both. Unlike the earlier regime, which taxed manufacture, sale and service provision separately, GST taxes the supply itself as a single event, which is why it is described as a consumption-based tax.

  1. AManufacture of goods only
  2. BSupply of goods or services or bothCorrect
  3. CSale of goods only
  4. DImport of goods only

Explanation

GST is a destination-based tax on consumption levied on the supply of goods or services or both. Earlier taxes had separate taxable events such as manufacture (excise), sale (VAT) and provision of service (service tax). Naming only manufacture or sale reflects the old regime and is wrong.

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