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

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....as issued the above referred circular. This Circular is clarificatory in nature. For uniformity, the said circular issued by the Department of Revenue, CBIC, is being made applicable, mutatis mutandis, in implementation of the TNGST Act, 2017. Copy of the referred circular is attached herewith. Sd/- S. Nagarajan Commissioner of State Tax   Circular No. 251/08/2025-GST F. No CBIC-20001/3/2025-GS-GST Government of India Ministry of Finance Department of Revenue Central Board of Indirect Taxes and Customs GST Policy Wing North Block, New Delhi Dated the 12th September, 2025 To, The Principal Chief Commissioners/ Chief Commissioners of Central Tax (All) The Principal Director Generals/ Director ....

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....x liability. As the transaction value is not allowed to be reduced on account of issuance of financial/ commercial credit note, accordingly the tax charged from the recipient would also not get reduced. 3. Thus, it is clarified that the recipient will not be required to reverse the Input Tax Credit attributed to the discount provided on the basis of financial/ commercial Credit notes issued by the supplier, as there is no reduction in the original transaction value of the supply and accordingly the corresponding tax liability would also not get reduced. 2. Whether a post-sale discount offered by a manufacturer to its dealer/ distributor, would be treated as ....

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....ified that such a discount cannot be included in consideration as the monetary value of the inducement of further supply of these goods. 3. However, in cases where the manufacturer has some agreement with an end customer to supply goods at a discounted price, the manufacturer may issue commercial or financial credit notes to the dealer, enabling such dealer to provide the goods at the agreed discounted rate to the end consumer. Therefore, it is clarified that such a post sale discount, given by the manufacturer to the dealer for supplying goods to the end customer at a discounted rate, should be included in the overall consideration as it is an inducement tow....