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of <h1>Understanding GST Margin Scheme: Pay Tax Only on Profit, Not Purchase Price, Rule 32(5) Explained</h1> The Margin Scheme in GST allows dealers of second-hand goods to pay tax on the margin, which is the difference between the selling and purchase price, to prevent double taxation. According to Rule 32(5) of the CGST Rules, 2017, if the margin is negative, it is ignored. For repossessed goods, the purchase value is reduced by five percentage points per quarter. Notification No.10/2017 exempts intra-State supplies of second-hand goods from unregistered suppliers from central tax. For example, if a company buys a car for 3 lakh and sells it for 3.5 lakh, GST is levied on the 50,000 margin. No input tax credit is claimed under this scheme.
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