How to calculate GST with different raw materials

[Asked by Guest]

My product contains raw materials which attracts 5%, and 18% GST. My Final product GST % is 5 only.

Sized cotton/viscose warp - 18%

Cotton weft yarn - 5%

Final Product Saree with 85% cotton and other materiasl (HSN code 5208) is taxed at 5%.

So finally ended up n making loss, any other way to overcome this problem?

AI Summary

Inverted duty structure: refund of accumulated input tax credit available under CGST rules using prescribed refund formula.
Inputs taxed at higher GST rates than the final product create an inverted duty structure, permitting refund of accumulated input tax credit under the CGST refund mechanism. The refundable amount is calculated by a formula linking turnover of inverted-rated supplies, Net ITC and Adjusted Total Turnover, less tax payable on such supplies. "Net ITC" means input tax credit availed on inputs and input services during the relevant period; "Adjusted Total Turnover" excludes exempt supplies other than zero-rated supplies for the relevant period.