Tax treatment of sales promotion schemes: clarifies when free samples, BOGO offers and discounts affect GST and ITC. Clarifies GST treatment: free samples and gifts without consideration are not supply except under Schedule I and do not permit ITC on related inputs unless they qualify as supply; 'buy one get one free' is a single-priced multiple-item supply whose tax rate depends on whether it is a composite or mixed supply, with ITC available to the supplier; discounts agreed at or before supply and meeting statutory conditions may be excluded from value and attract ITC adjustments by recipients; secondary post-supply discounts cannot be excluded unless conditions are met, though credit notes may be issued commercially.
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Tax treatment of sales promotion schemes: clarifies when free samples, BOGO offers and discounts affect GST and ITC.
Clarifies GST treatment: free samples and gifts without consideration are not supply except under Schedule I and do not permit ITC on related inputs unless they qualify as supply; 'buy one get one free' is a single-priced multiple-item supply whose tax rate depends on whether it is a composite or mixed supply, with ITC available to the supplier; discounts agreed at or before supply and meeting statutory conditions may be excluded from value and attract ITC adjustments by recipients; secondary post-supply discounts cannot be excluded unless conditions are met, though credit notes may be issued commercially.
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