GST Certification Course by KPMG

Today we will look at the GST Course by KPMG in detail. Before that, let’s look at what GST is all about. A direct tax can be defined as a type of tax where the incidence and impact of taxation falls on the same entity. It is applicable to the income or profits of the person who pays it, rather than on goods and services. A few examples of direct taxes are income tax, corporation tax, property tax, inheritance tax, gift tax, etc.

The word “tax” is derived from the Latin word “taxare” or “taxo” which means to compute. A tax is a mandatory liability or a financial charge which is imposed on a taxpayer who can be an individual or any legal entity. It is levied by a governmental organization in order to fund government spending and various public expenditures. There are two types of taxes in India i.e., direct tax and indirect tax.

An indirect tax can be defined as a type of tax where the incidence and impact of taxation do not fall on the same entity rather it is passed on to another entity or individual. These taxes are imposed on the manufacturer or the supplier which is then passed on to the consumer. An indirect tax raises the price of the products on which they are imposed. A few examples of indirect taxes are customs duty, central excise, service tax, value-added tax, goods and service tax, etc. 

When a tax is imposed by any government be it state, central or local it has the following features or characteristics which are very important:

1. Mandatory/ Compulsory: When a tax is levied by the government on something then it is done so to benefit the people of the country. So, it is a compulsion on the citizens to pay taxes levied by the government. It is required by the law to do so and every citizen is liable to follow it.

2. Contribution to building the nation: Any country needs money for its development. India is a densely populated country with a vast population under the poverty line so it needs a lot of money for its development like for basic healthcare, infrastructure, defense, education, food, etc. So, tax is a contribution made by the citizens of the country for the betterment and development of their country.

3. Public Welfare: One of the major reasons for collecting taxes is for the benefit of the public and society in general. Today, more than 50 welfare schemes are running in our country for the upliftment of the people in our society like Pradhan Mantri Jan DhanYojna (PMJDY), Sukanya SamriddhiYojna (SSY), Pradhan Mantri Jeevan Jyoti BimaYojna (PMJJBY), RashtriyaSwasthyaBima Yojana (RSBY), National Social Assistance Scheme, Pradhan Mantri Mudra Yojana, etc. These schemes help all the different sectors of society. Taxes are collected for the overall welfare of society not for any specific person. Disaster management and rescue operations are important aspects of tax collection.

4. Paid out of income earned: Tax is paid only when income is earned by an individual. If an individual does not generate the threshold income defined and modified by the government from time to time then they are not liable to pay the taxes. Anyone who earns an income that matches the threshold income defined by the government is liable to pay taxes to the government for the overall development of the country.

5. Growth of Economy: Government needs to take care of the infrastructure like for building roads, dams, bridges, etc., and to do so it has to collect taxes so that the government can invest in the economical development of the country. A country like ours which is densely populated needs a lot of money for its development so collecting taxes from its citizens is important.

In India, the history of taxation is very old. It is rooted in the period of Manu Smruti (one of the oldest scriptures of India) and Arthasastra. Before getting to the history of taxation in India let us understand what income is as a tax is imposed on the income of any entity. Income can be defined as an amount or something equivalent to money earned or received by an individual or a business in exchange for goods and services provided by them or due to the investment of capital made by them.

Individuals generally receive income in the form of salary or wages. In legal terms income can also be defined as the return in money from one’s business, labor, or capital invested; gains, profits, salary, wages, etc. The gain which is derived from capital, from labor or effort, or both combined, including profit or gain through sale or conversion of capital. We can make it clearer by understanding it with the help of an example. Suppose Miss Payal earned 20000 INR as salary for the month of August and earned 5000 INR from the investments made by her in an equity account, so the total income earned by her for the month of August is 25000 INR.

The ancient taxation system was based on maximum social welfare. During the time of the Maurya dynasty, the higher class of citizens contributed one-sixth of their income as tax. During the Mughal samrajya, the invaders brought with them their own taxation system. The infamous Jizya tax, a tax that was imposed on the non-Islamic people of the country. In India, it was abolished by King Jalal-ud-din Muhammad Akbar. In present times also the tax system is based on the ancient system of taxation. In modern times the tax system was introduced by Sir James Wilson in the year 1860 in the month of February.

After the Mutiny of 1857, the British government had to face an acute financial crisis and to fill the treasury back, the first Income-tax Act was introduced in India. Later on, many amendments and new tax rules were introduced to make the tax system stronger in the country. After the first World War, a new Income Tax Act was passed to counter the residual effects of the economic devastation caused by the war in 1918.

This income tax Act was not altered till 1922. After 15 years after India gained freedom from the British, the income tax Act was altered again. The current Income Tax Act was adopted in the year1961 and was bought into force with effect from April 1st, 1962. It includes the whole of India, including Sikkim and Jammu, and Kashmir. The Central Board of Revenue had bifurcated and created a separate Board for Direct Taxes which was called the Central Board of Direct Taxes under the care of the Central Board of Revenue Act, 1963. 

Currently, there are five categories under which income is taxed by the government of India:

1. Income from salary means the income or remuneration received by an individual for services he or she is rendering or a contract was undertaken by him or her. This clause essentially acquired the remuneration received by an Individual for the services provided by him or her under the contract of employment.

2. Income from business or profession which means any income that is shown in profit and loss account after taking into account all the allowed expenditures by an individual who is liable to pay taxes to the government against any kind of income earned or losses suffered by him for a particular assessment year. The income also includes both positive and negative incomes i.e., both profit and loss.

3. Income from capital gains means capital gain that can be defined as any profit that is received through the sale or purchase of a capital asset. The profit that is received is a type of income earned. Since it is an income, a tax has to be paid on the income received. The tax that is paid on this type of income is called capital gains tax. It can either be a long-term or a short-term income.

4. Income from the property means any income that is earned from the property by an individual like rent. This income earned is taxable income. When a property is not let out even then sometimes the owner has to pay tax on the deemed rent.

5. Income from other sources means any residual income that cannot be placed in other heads of income. These include interest received from savings bank accounts, post office savings accounts, fixed deposits, recurring deposits, family pension, income from subletting of house property by a tenant, insurance commissions received, interest on deposits with companies.

Each government amends the Act to finance government operations, and distribute wealth more evenly, and reduce the gap between the rich and the poor. Income tax in India is assessed annually for the previous financial year. 

India has a three-tier system for taxation. The central government and the state government can both impose a tax on the citizens of the country. The State government in turn can delegate taxation to the local governing bodies like the municipal corporations and panchayats. Since the Indian tax system is one of the most complexes in the world, there is a high demand in India for income tax consultants, GST consultants, auditors, and other professionals. 

As a nation evolves new changes are made for its development. Hence new laws are introduced and amendments are made. India being no exception introduced Goods and Service Tax. The major reason to introduce GST was to reduce the tax burden that used to fall both on companies and consumers. Previously, multiple taxes were added at each stage of the supply chain, without taking credit for taxes paid at previous stages because of which the end cost of the product didn’t clearly show the particular cost of the merchandise and the way much tax was applied. 

This cascading structure was too complex and inefficient. Hence GST was introduced to integrate most taxes into a single one, that would be applied to the sale and purchase of goods and services, with deductions for taxes paid at previous supply chain stages. This structure was predicted to be easier to track both for the government and business owners. This is the reason that the Goods and Service Tax was introduced. The major reason to introduce GST was to reduce the tax burden that used to fall both on companies and consumers. 

Previously, multiple taxes were added at each stage of the supply chain, without taking credit for taxes paid at previous stages because of which the end cost of the product didn’t clearly show the particular cost of the merchandise and the way much tax was applied. This cascading structure was too complex and inefficient. Hence GST was introduced to integrate most taxes into a single one, that would be applied to the sale and purchase of goods and services, with deductions for taxes paid at previous supply chain stages. 

This structure was predicted to be easier to track both for the government and business owners. Goods and Service Tax or GST is an indirect tax that came into effect from July 1st, 2017 in India. It is levied on the supply of goods and services in India. This tax replaced existing multiple taxes levied by the central and state governments. 

According to Wikipedia

“GST is a comprehensive, multistage, destination-based tax: comprehensive because it has subsumed almost all the indirect taxes except a few state taxes. Multi-staged as it is, the GST is imposed at every step in the production process but is meant to be refunded to all parties in the various stages of production other than the final consumer and as a destination-based tax, it is collected from point of consumption and not point of origin like previous taxes”.

 

The concept of GST was introduced by a French tax official in the year 1954. Today GST has been introduced in more than 160 counties all over the world including the European Union and Asian countries such as Sri Lanka, Singapore, and China.

In India goods and services are divided into five different taxations and they are- 0%, 5%, 12%, 18%, and 28%. Few products and services like petroleum products, alcoholic drinks, and electricity are not taxed under GST. A special rate of 0.25% is levied on rough precious and semi-precious stones and 3% on gold. They are rather taxed separately by the individual state governments, as per the previous tax system. 

The tax rates, rules, and regulations are governed by the GST Council which consists of the finance ministers of the central government and all the Indian states. Currently, the members of the GST Council are Smt. Nirmala Sitharaman (Minister of Finance and Corporate Affairs) from Central Government, Shri Anurag Singh Thakur(Minister of State Finance and Corporate Affairs) from Central Government, Shri BugganaRajendranath (Minister for Finance and Legislative Affairs) from Andhra Pradesh, Shri Chowna Mein (Minister for Finance and Investment) from Arunachal Pradesh, Dr. Himanta BiswaSarma (Finance Minister) from Assam, Shri Sushil Kumar Modi (Deputy Chief Minister) from Bihar, Shri T. S. Singh Deo (Minister for Commercial Taxes) from Chhattisgarh, Shri Manish Sisodia (Deputy Chief Minister) from Delhi, Shri MauvinGodinho (Cabinet Minister) from Goa.

Others include Shri Nitin Patel (Deputy Chief Minister) from Gujarat, Shri Dushyant Chautala(Deputy Chief Minister-in-charge of Excise and Taxation Department) from Haryana, Shri Jai Ram Thakur (Chief Minister) from Himachal Pradesh, Shri K.K. Sharma [Advisor to Honourable Governor ( I/C Finance )] from Jammu and Kashmir, and others. 

With the introduction of GST, it has become essential for every accounting professional to know about GST and the current tax system of our country. 

There are many different types of courses that help us understand this better. Many institutes are running different certification courses for this. KPMG is one of the most renowned institutes from where the present accounting and taxation system can be learned professionally.

KPMG entities in India were established under the laws of India and are owned and managed by established Indian professionals. It was established in the year 1993 in the month of August. 

Today, they operate from 14 cities in India which include Ahmedabad, Chennai, Gurugram, Hyderabad, Jaipur, Kochi, Kolkata, Mumbai, Noida, Pune, Vadodara, Vijayawada, Bengaluru, and Chandigarh. They have a domestic client base of over 2700 companies.

They provide rapid performance-based, industry-tailored, and technology-enabled business advisory services which are delivered by a number of leading talented professionals of India. These professionals are grouped by industry focus and their clients can deal with industry professionals who speak their language. They enable the delivery of informed and timely business advice to clients.

The GST Certification Course provided by KPMG includes the following:

1. Audit- They are one of the biggest auditing firms whose audits give assurance over information used by investors and capital markets.
2. Tax- They provide tax advice for both individual and corporate taxpayers.
3. Advisory- They provide advice to address the challenges of an unpredictable economic environment.

KPMG’s course for Accounting Professionals:

This is a 29-module practical course that takes the candidate through a basic to a more advanced financial methodology. It covers practical aspects of accounting and accounting practices. Basically, this course covers everything that an accounting professional requires i.e., national and international accounting concepts, taxation both direct and indirect. Indirect tax now in India includes GST so if someone is interested in getting their basics clear in GST then can definitely go for this course. It is a complete package in itself.

In this course hybrid learning through a mix of face-to-face sessions and learning management sessions is given attention to. KPMG provides exclusive learning material, which includes books, classroom or live online tutoring.

Candidates who are pursuing Bachelor’s or Master’s in Commerce or BBA or BSc or BA and/or accountants working in the industry can apply for this course. Also, candidates with 45% aggregate in years 1 & 2 or both while pursuing graduation or 45% if they have already completed graduation are eligible to apply for this course.

Enrolment for the course is based on academic record evaluation and the personal interaction of the candidates.

• 6 months course includes 400 hours of training 
• 200 hours – classroom-based training 
• 200 hours – training through the learning management system which is made available to the students who registered for the course.

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On successful completion of the GST Certification course by KPMG, candidates will receive a certificate from the institute. 

The above-mentioned course is a complete course in which all the basics of accounting and taxation are covered which can help any aspiring accountant to become an accounting professional. The duration of the course is really good which is a time worth investing in. Not just for accounting professionals anybody who has an interest in accountancy and taxes and is eligible can enroll in this course and gain the knowledge that they want. It is a great course introduced in India by KPMG one of the most trusted accounting firms.