New Delhi, July 15, 2017
Dealers in the business of old and used empty bottles will have to pay the Goods and Services Tax levy on second hand goods.
The government noted that this was its position regarding applicability of the Margin Scheme under GST for dealers in second hand goods in general and for dealers in old and used empty bottles in particular.
In an official statement, the Ministry of Finance said that Rule 32(5) of the Central Goods and Services Tax (CGST) Rules, 2017 has defined the margin scheme for the sale of second hand goods.
The government states that a GST will be levied on the value of supply. And this value shall be the difference between the selling price and purchase price. In cases where the product is selling at a price lower than it has been procured, the GST will not be levied.
The government has also stated that intra-state supplies of second hand goods received by a registered person are exempt from the Central Tax levy. This has been done to avoid double taxation on the outward supplies made by such registered person, since such person operating under the Margin Scheme cannot avail input tax credit on the purchase of second hand goods.
All traders need to register before July 30.
In another statement, the government requested all traders to register without waiting for the last date. It noted that as per the GST laws, it is mandatory for traders to register on or before July 30. However, traders need not register if engaged exclusively in the supply of exempted goods or services or both.
The government noted that traders carrying out businesses and having an annual aggregate turnover in the preceding financial year exceeding Rs. 20 lakh (Rs 10 lakh in Special Category States) need to register in all the States/Union Territories from where they are making taxable supplies.
[The Hindu Business Line]