Tax Slab & it's mapping

Purpose:

The GST council of India has broadly categorized all goods & services into five tax slabs, namely 3%, 5%,12%,18% and 28%. In addition, there is a 0% rate (Nil-rated supplies) for essential goods like salt, jaggery, and cereals. Some of the items are exempt under the GST law (Exempt supplies) like fruits & vegetables and some of the items do not come within the purview of GST (Non-GST supplies) like petrol/diesel and alcohol.

Exports and Special Economic Zone (SEZ) supplies are treated as Zero rated supplies. Also, for some items like tobacco, cigarettes, and pan masala, an additional levy called GST compensation CESS is charged besides the GST regular charge.

Feature:

Using Tax Slab we can make the items have different tax percentage based on their selling price, for example, less than or equal to Rs. 1000 = 5% GST and for more than Rs. 1000 = 12% GST.

Benefits of GST Tax Slab:

1. It has brought together many indirect taxes under one umbrella, simplifying taxation for service & commodity businesses.

2. It reduces the need for small companies to comply with excise, service tax & VAT & brings accountability & regulation.

3. The tax collected is likely to be distributed across the country, providing funds for development to the developing or underdeveloped pockets in India.

4. It reduces logistics costs by eliminating border taxes and resolving check-post discrepancies.

1. To create Tax Slab:

Click: Inventory > Masters > Tax Slab Rate Masters

A Tax - Slab Rate Master screen will appear.

Fill in the details: Tax Slab Name, Rate from, Rate To & Tax.

Click Save function key [F6] & answer as 'Yes' for confirmation.

Click [F12] 'Close' function key & confirm as 'Yes' to close the screen.

2. To map Tax Slab to Items:

Click Inventory > Masters > Items

In Item Master screen, click the 'Edit' function key to load the items.

Select the items by clicking the Enter Key in the Name section.

In GST section tab, click Tax slab & select the option.

Click Save [F6] function key to save the Item created.

3. To reflect Tax Slab in Purchase Screen:

Click Purchase > Purchase Invoice

In Purchase Entry Screen:

Select the Distributor Code, Invoice No., Invoice Amount and Load the items selected for tax slab rate.

Here, you can check as per the purchase price selected for the product, GST varies. This is Tax Slab Mapping.

4. To reflect Tax Slab in Sales Screen:

Click Sales > Sales Bill

In Bill Entry Screen:

Load the tax slab range selected item here & check for GST included in the final bill:

Link for References: 

https://taxguru.in/goods-and-service-tax/gst-apparel-sector.html#:~:text=Under%20the%20all%20categories%2C%20any%20piece%20of%20apparel,per%20piece%20would%20be%20taxed%20at%2012%25%20GST.

https://www.taxscan.in/12-gst-payable-on-footwear-of-sale-value-not-exceeding-rs-1000-per-pair-cbic/146860/