Readymade garments of sale value not exceeding Rs. 1000 per piece attract 5% GST. Readymade garments of sale value exceeding Rs. 1000 per piece attract 12% GST. How does a supplier determine what rate to charge on readymade garments?
- The sale value referred to in the notification refers to the transaction value and not the retail sale price of such readymade garments.
- That is, if a wholesaler supplies readymade garments for a transaction value of Rs.950 per piece to a retailer, the GST chargeable on such readymade garments will be 5%.
- However, if the retailer sells such readymade garments for Rs.1100 per piece, the GST chargeable on such readymade garment will be 12%.
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