Clarification on various doubts related to treatment of secondary or post-sales discounts under GST

Post sale discounts as conditional consideration require GST by the dealer and affect input tax credit entitlement and valuation.

Post sale discounts without dealer obligations relate to the original supply and may be excluded from supplier's value of supply if statutory reduction conditions are met. Conditional post sale incentives given for promotional acts are separate consideration for services by the dealer and subject to GST, with the supplier eligible for input tax credit. Payments by the supplier enabling the dealer to reduce customer price form part of the dealer's value of supply, and credit note situations do not obligate the dealer to reverse ITC if the dealer pays the reduced net value plus original tax in accordance with rules.