Sale of used vehicle under GST

[SURYAKANT MITHBAVKAR]

Is there any notification to sale used vehicle at concessional rate of GST I.e. 65% of rate of GST applicable.

[YAGAY andSUN]

If the supplier is a registered person and such supplier had purchased the Motor Vehicle prior to July 1, 2017 and has not availed input tax credit of central excise duty, Value Added Tax or any other taxes paid on such vehicles, then such vehicles when sold will attract GST of 65% of the applicable GST) rate, including compensation cess.

These rates would apply for a period of three years with effect from 1 July 2017 ie apply up to 30th June 2020.

Notifications:

1. Notification No. 37/2017-Central Tax (Rate) dated October 13, 2017
2. Similar notification is issued under the UTGST Act vide Notification No. 37/2017 – Union Territory tax (Rate) dated October 13, 2017.
3. Similar notification is issued under the IGST Act vide Notification No. 38/2017- Integrated Tax (Rate) dated October 13, 2017.
4. Similar notification is issued under GST (Compensation to the States) Act for Motor Vehicle falling under chapter heading 8702 & 8703 vide Notification No. 7/2017-Compensation Cess (Rate) dated October 13, 2017.
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AI Summary

Concessional GST on used vehicles applies where the seller did not claim input tax credit at purchase. If the supplier is a registered person who purchased the motor vehicle prior to 1 July 2017 and did not avail input tax credit of central excise, VAT or other taxes on that vehicle, the sale of such used vehicles is taxable at 65% of the applicable GST rate (including compensation cess); this concessional rate applies for three years from 1 July 2017 to 30 June 2020 and is implemented by Notifications Nos. 37/2017 (Central/UT/IGST equivalents) and 7/2017 (Compensation Cess).