Discount under gst

This query is : Resolved

CS and ACMA Raju lakhani (Querist)
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08 November 2017 My purchaser want 5% GST rate since rate of Product is 1000/- under which GST rate is 12% .
But after discount given on Value of Rs. 50000/- (include both 5% & 12% GST product) , then purchaser 12% product come to 5% slab as per purchaser Rs. 900/-

Kindly tell the solution what i have to reply.

CS and ACMA Raju lakhani

CS and ACMA Raju lakhani (Querist)
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13 November 2017 Please reply expert

Asha Kanta Sharma

Asha Kanta Sharma (Expert)
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12 July 2024 It seems like there is some confusion regarding the GST rate applicable to the product after discount. Here’s a clear response you can provide to your purchaser:

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Dear [Purchaser's Name],

Thank you for your message regarding the GST rates applicable to the products. Allow me to clarify the situation:

1. **Original Product Price and GST Rate**: The product is priced at Rs. 1000/- and falls under the GST rate of 12%. Therefore, the GST applicable at this rate would be 12% of Rs. 1000/-, amounting to Rs. 120/-.

2. **Discount Offered**: I understand that a discount of Rs. 500/- has been applied, which reduces the effective price to Rs. 500/-. This discount applies across both products taxed at 5% and 12%.

3. **Effective GST Calculation**: After applying the discount, the effective GST calculation for the product originally taxed at 12% is as follows:
- Original price: Rs. 1000/-
- Discount: Rs. 500/-
- Effective price: Rs. 500/-
- GST applicable at 12% on Rs. 500/-: Rs. 60/-

Therefore, even after applying the discount, the product that originally attracted a GST rate of 12% continues to be taxed at 12%. The discount does not change the GST rate applicable to the product itself; it only affects the taxable value.

Please let me know if you need any further clarification or if there’s anything else I can assist you with.

Best regards,

[Your Name]

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This response should help clarify the misunderstanding and ensure your purchaser understands the correct GST implications after applying the discount. If there are specific details or additional context you need to include based on your business’s situation, feel free to customize the response accordingly.

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