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IGST

Goods worth ₹...

Question

Goods worth ₹40000 are transferred from Kolkata to Chennai at a GST rate of 12% and then from Chennai to Ahmedabad (with profit of ₹10000) at the same rate of GST. Find the Net Tax liability of the dealer at Chennai.

A

₹980

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B

₹2400

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C

₹1800

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D

₹1200

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Solution

The correct option is D ₹1200
Since the transaction is from Kolkata to Chennai and then Ahmedabad,it is a case of Inter-state transactions, the GST charged will be IGST.

Net Tax liability of the dealer at Chennai = IGST on Output (in Ahmedabad) - IGST on Input (ITC)
= 12% of ₹50000 - 12% of ₹40000
= 12% of ₹10000
= $\frac{12}{100} \times 10000$
=₹1200.

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