PRICE OF THE PRODUCT UNDER PRE AND POST GST

[RameshBabu Kari]

Dear Expert,

If the price of the product was Rs.10,000/- which was pre-gst price including vat to the customer in the market. Price of the same product will be the same ₹ 10,000/- even post gst ?

i.e Post gst price of the product, if gst rate is 18% = price of the product is ₹ 10,000/-(cost = 8200 + cgst 900 + sgst 900)

or

Post gst price = 11800/=(10,000+1800)

Which one is correct ? and is there any wrong on the 11800/- of the product to the custome ? Please clarify with applicable provisions and rules of gst.

AI Summary

Transaction value governs GST liability; if gross price is unchanged, GST is computed on the underlying pre-tax value.
Post-GST pricing depends on the transaction value stated on the invoice; GST is computed on that declared value. If a seller keeps the gross customer price unchanged after VAT is subsumed, the taxable base must be derived from that gross price and GST applied accordingly. Alternatively, the seller may adjust the gross price upward so GST is calculated on a higher transaction value. The invoice must show the value of supply, the GST rate, and the tax amount.