GST Rate Change
One party billed to his customer with GST 28% and meanwhile tax rate was reduce @ 18%. After ten days, now buyer is demanding credit note for 10% of GST. What is the solution.
Q- How do we determine the rate of tax in case, if there is change in the GST tax rates?
Ans. Three important events need to be considered –
1.Date of raising invoice,
2.Receipt of payment and
3.Completion of supply.
If any of the two events occur before the change in rate of tax, then the old rate will apply else the new rate will apply.
Illustration – Rate of GST on Supply made on or after November 15, 2017 reduced from say 28% to 18% then the tax to be applied on supplies will be as under :
Before – Event occurred before November 15, 2017 : 28%
After – Event occurred on or after November 15, 2017 : 18%
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