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Question
Suppose you run a textile company in Chennai. You buy the raw materials worth ₹50,000 from Salem. After processing, you export the final products worth ₹1,00,000 to Mumbai.
Select the Goods and Services Tax that is to be paid.
Suppose you run a textile company in Chennai. You buy the raw materials worth ₹50,000 from Salem. After processing, you export the final products worth ₹1,00,000 to Mumbai.
Select the Goods and Services Tax that is to be paid.
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Solution
The correct option is D IGST on ₹1,00,000
The Goods and Services Tax is collected based on the trade of goods and services. When goods and services are traded within a state or union territory, it is known as intra state trade. On this, the central government imposes a Central Goods and Services Tax or CGST and the state government imposes the State Goods and Services Tax or SGST. When goods and services are traded between two states, it is known as inter state trade. In this case, the central government imposes and collects Integrated Goods and Services Tax or the IGST.
The Goods and Services Tax is collected based on the trade of goods and services. When goods and services are traded within a state or union territory, it is known as intra state trade. On this, the central government imposes a Central Goods and Services Tax or CGST and the state government imposes the State Goods and Services Tax or SGST. When goods and services are traded between two states, it is known as inter state trade. In this case, the central government imposes and collects Integrated Goods and Services Tax or the IGST.
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