GST and chambers of commerce

GST (Goods and Services Tax) came into force on 1 July 2017 under the slogan 'One Nation, One Tax'. It replaced 17 taxes and 23 cesses that were charged earlier by the centre and the states. It is a destination-based tax on the supply of goods and services.

How it is charged:

• Within a state: CGST (for the centre) and SGST (for the state), in equal halves. If a maker in Ajmer sells goods worth ₹10,000 in Jaipur at 18 per cent, the bill shows CGST 9 per cent (₹900) plus SGST 9 per cent (₹900).
• Between states: IGST (integrated GST). The same sale to a buyer in another state carries IGST of 18 per cent (₹1,800).

Every trader in the chain pays GST, but claims input tax credit for the tax already paid on its purchases. So the tax falls only on the value added at each stage, and the old cascading effect (tax charged on tax) disappears. Exports and supplies to Special Economic Zones (SEZs) are zero-rated.

The GST Council sets the rates. It is chaired by the Union Finance Minister; the states together have two-thirds of the voting weight; and decisions need a 75 per cent majority. Since 22 September 2025, the main rates are 5 per cent and 18 per cent.

Chambers of commerce such as ASSOCHAM, CII and FICCI speak for business and work with the government on matters that affect internal trade: the movement of goods between states, taxes, marketing of farm produce, weights and measures, infrastructure and labour laws.