Goods and Services Tax (GST)

Written By
Paul Tracy
Updated July 20, 2021

What Is a Goods and Services Tax (GST)?

A goods and services tax (GST) is simply a tax on goods and services for domestic consumption. This tax system is in place in about 160 countries, including Canada, India, Vietnam, Australia, United Kingdom, Spain, Italy, Brazil, and South Korea.

France was the first country to implement the GST in 1954, and India adopted the system in 2017.

How a GST Works

Like a sales tax, businesses collect the GST from customers when they purchase goods or services and then remit those taxes to the government. A country using the GST system integrates central taxes with state-level taxes and collects them as one single tax. The tax structure is thus

Why a GST Matters

The goods and services tax (GST) is a federal sales tax and provides revenue to the governments (about 160 countries) in which it is implemented. This revenue is essential for funding nationwide projects and expenditures that serve the public interest. 

Activate your free account to unlock our most valuable savings and money-making tips
  • 100% FREE
  • Exclusive money-making tips before we post them to the live site
  • Weekly insights and analysis from our financial experts
  • Free Report - 25 Ways to Save Hundreds on Your Monthly Expenses
  • Free Report - Eliminate Credit Card Debt with these 10 Simple Tricks
Ask an Expert
All of our content is verified for accuracy by Paul Tracy and our team of certified financial experts. We pride ourselves on quality, research, and transparency, and we value your feedback. Below you'll find answers to some of the most common reader questions about Goods and Services Tax (GST).
Be the first to ask a question

If you have a question about Goods and Services Tax (GST), then please ask Paul.

Ask a question

Paul has been a respected figure in the financial markets for more than two decades. Prior to starting InvestingAnswers, Paul founded and managed one of the most influential investment research firms in America, with more than 3 million monthly readers.

If you have a question about Goods and Services Tax (GST), then please ask Paul.

Ask a question Read more from Paul
Paul Tracy - profile
Ask an Expert about Goods and Services Tax (GST)

By submitting this form you agree with our Privacy Policy

Don't Know a Financial Term?
Search our library of 4,000+ terms