Goods And Service Tax (B.Com) 3rd Sem Previous Year Solved Question Paper 2022

Input Tax Credit (ITC) is a fundamental concept in the Goods and Services Tax (GST) system. It allows registered businesses to offset the tax they pay on their purchases and expenses against the tax they collect on their sales. Essentially, ITC prevents the cascading effect of taxation, where taxes are levied on top of taxes, by ensuring that businesses pay GST only on the value they add to a product or service. To claim ITC, proper documentation is crucial, including tax invoices and bills, and the supplier’s compliance with GST rules is necessary. ITC encourages tax compliance, reduces the tax burden on businesses, and promotes transparency in the tax system. It’s a pivotal feature of GST, promoting economic efficiency and simplifying the taxation process for businesses.