GST Not Applicable on Post-Sale Discounts Given by Manufacturers to Dealers, Says CBIC

New Delhi, Sept 14: The Central Board of Indirect Taxes & Customs (CBIC) has clarified that post-sale discounts offered by manufacturers to dealers will not attract GST, under recent changes in GST rules. The decision aims to ease compliance and reduce litigation for businesses.

What Are Post-Sale Discounts?

These discounts are rebates or price reductions given by manufacturers *after* the sale has already taken place, often to dealers, based on sales volume or other performance criteria. Under the revised GST provisions, such discounts are exempt from taxation when they meet certain conditions.

Conditions & Clarifications

Per experts, the key conditions include:

• The discount is given by the manufacturer to a dealer (business-to-business).
• The discount is not linked to additional obligations by the dealer beyond what was agreed at the time of supply.
• The manufacturer issues a credit note under GST (as required) for the discount.

Impact on Business & Trade

Industry experts have welcomed the move, saying this will reduce compliance burden, uncertainty and disputes. For businesses that regularly give post-sale discounts, the clarification provides relief and streamlines accounting practices.

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Source: Daily Excelsior (Read Original)

Labels: GST, Post-Sale Discount, CBIC, Business, Tax Law

Tags: #GST #PostSaleDiscount #CBIC #TaxClarity #TradeRelief

Disclaimer: This article is a rewritten summary based on reporting by Daily Excelsior and other expert commentary. Jammu News Portal does not assume responsibility for external content accuracy.