What is GST?
It refers to the Goods and Services Tax. It is a tax that is levied on all goods and services regardless. However, items such as groceries may be exempted but almost all products and services are subjected to this tax. It is paid by the consumers and in essence, it is the main source of revenue for the government of a state.
Implementation of GST
Most countries with a Goods and Services Tax have a unified GST system by the virtue of it being a very general form of tax so a single rate is implemented throughout the countries.
The mechanism of implementation of tax is rather simple. The businesses add the GST determined by the government to their goods and services and is paid for by the consumers when they purchase the goods or hire services. The Government then collects this tax from the businesses who forward the consumer paid tax on their products and services to the government. Some governments refer to it as the Value Added Tax (VAT).
History of GST:
GST was first implemented by France back in the year 1954 and since then, roughly 160 countries have adopted this tax system. However, calculating it wasn't as easy in the past as it has become now with tools like the GST calculator we offer, which stands out for its user friendly framework and simplicity.
Purposes of implementation of GST:
GST was first implemented by France back in the year 1954 and since then, roughly 160 countries have adopted this tax system. However, calculating it wasn't as easy in the past as it has become now with tools like the GST calculator we offer, which stands out for its user friendly framework and simplicity.
Let's consider the classic rules of a functioning state. It has an open market, a constitution, a military, a judicial system, an administrative body and a law and order institution as its main pillars on which state stands.
The open market is usually left on its own because of its nature of functioning. Essentially, an open market is where trade happens in a way that sellers and buyers have unrestricted access and the prices of products are then determined naturally by the rule of supply and demand.
Government intervention is minimal due to the prevailing neoliberal market theories dominating the economic discourse in theory and practice today all across the world. In a nutshell, this type of market framework is dependent on the law of supply and demand when it comes to pricing of products and services. The more the supply, the less the demand and less the price and vice versa. These market actors are let to freely engage in trade provided that a number of taxes are imposed on their goods and services, their potential for selling and buying etc.
In return, the state regulates the market when it crashes or is at the brink of crash or corresponding scenarios like that. On the other hand, with the collected taxes, the government builds up their revenue and budget which is spent on its people in the form of welfare, citizen benefits, public sector ventures, states own businesses (the profits of which are used for the public sector and welfare as well) and public property. Taxes therefore, are not the nuisance they are portrayed to be when in reality, they are taken by the people, from the people and spent by the people on the people.
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Calculation of GST:
The process of calculating GST can be followed through in simple steps. The emergent process however might be a little complicated and prove slowing down of the trade. For this reason exactly, we have developed GST calculator among other such online tools.
Our GST calculator might have a simple user interface with simple keystrokes of inputs and finding out the output result at lightning speeds but the mechanism behind is dependent on a number of steps which make the calculation possible.
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It calculates the general sales tax when inputs of net price and government imposed GST percentage are provided to it as inputs. It then determines the value of the percentage of GST by dividing it to 100. It then multiplies the given net price with the decimal value of general sales tax to obtain the gross price and the amount of tax that corresponds to the percent of GST imposed by the government and finally, adds the gross price and the amount of tax to give you the final number.
The process may seem a little complex but it's made easy for the users by our calculator who can obtain their result with a couple of simple keystrokes.
Calculatored offers a lot of other free online tools and converters which you can use to enhance your learning and working efficiency.