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GST rate for merchant seller

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Ramachandran R

129 Points Posted on 22 March 2021

Hi,

I'm planning to sell my product to merchant exporter who inturn export to other countries. He got LUT number and use that during export.

My product GST rate is 5%. At what gst rate should I bill to him in India? same 5% or anything different to be billed.

Replies (4)

Quick Summary

This discussion clarifies the GST rate applicable when selling goods to a merchant exporter who holds an LUT number for exports. While your product's standard GST rate is 5%, the applicable rate for supplies to merchant exporters under specific conditions, as per Notification 41/2017, can be as low as 0.1% IGST. It's crucial that the merchant exporter places an order for the goods at a concessional rate, and a copy of this order must be provided to the jurisdictional tax officer. The supplier can submit this copy on behalf of the exporter.

Pankaj Rawat

GST Practitioner

29904 Points Posted on 22 March 2021

As per Notification 41/2017 IGST (R) , rate of GST is 0.1% IGST .

Note :Merchant Exporter shall place an order on registered supplier for
procuring goods at concessional rate and a copy of the same shall also be
provided to the jurisdictional tax officer of the registered supplier.
The above GST rate is applicable if conditions prescribed in said Notification is satisfied

Ramachandran R

129 Points Posted on 22 March 2021

Hi sir,

Thanks for the reply.

I understood the merchant exporter should place an order to supply at concessional rate to supplier.

Whether Exporter should submit the copy to tax officer or supplier can send copy on behalf of the exporter.

Pankaj Rawat

GST Practitioner

29904 Points Posted on 23 March 2021

THE SUPPLIER CAN SUBMIT COPY TO HIS JURISDICTION CIRCLE ON BEHALF OF EXPORTER.

NOTE : ATTACHED COVERING LETTER FROM SUPPLIER THAT "GST IS BEING CHARGED & COLLECTED ON FOLLOWING SUPPLY AT CONCESSIONAL RATE IN TERM OF NOTIFICATION 41/2017 IGST (R)"