Question

A is a dealer in Banaras (U.P.). he supplies goods/services worth Rs.8000 to a dealer B in Agra (U.P.). Dealer B, in turn, supplies the same goods/services to dealer C in Patna (Bihar) at a profit of Rs.1200. Find the input and output taxes for the dealer C under GST system; if the rate of GST is 18% and C does not sell his goods/services further?

Answer 1

From the question,
For the dealer A (intra-state transaction)
$$SP=\text{Rs.}8000$$
For the dealer B (intra-state transaction)
$$\begin{array}{cc}& CP=Rs.8000\\ & CGST=9\%\text{of}8,000=\text{Rs.}720\\ & SGST=9\%\text{of}8,000=Rs.720\end{array}$$
Given profit $=$ Rs. 1200
$$\text{SP}=\text{Rs.}9200$$
For the dealer C (inter-state transaction)
$$CP=\text{Rs.}9200$$
IGST $=18\%$ of Rs. $9200=\frac{18}{100}\times 9200=$ Rs. 1656
Input Tax $=$ Rs. 1656
As the dealer in Patna does not sell the product.
Thus, the output GST (tax on sale) $=$ Rs.0