Discount Component

This query is : Open

Deepak Rampuriwani (Querist)
Follow

06 September 2016 Dear Experts, kimdly guide on the below mentioned issue.. Me and my friend went to a cafe and we had these things in our brekfast Garlic bread---89.00 Tomato Soup--65.00 Extra Cheese--29.00 Choco Chip Delight--178 total -----------------------361.00 Discount @ 30% under a card scheme--108.00 Service tax---6.00%----21.66 Vat------------14.50%-----52.37 Net amount paid by me---327 now my ques is whether Service tax and vat chargeable after deducting discount amount or without deducting discount amount ?? As this cafe is not deducting this from the amount and charging taxes on full value. whether its practice is right or not ??

ACA Anurag

ACA Anurag (Expert)
Follow

07 September 2016 Dear Deepak, Govt tax are always paid on full value as govt does not allow any discount. Tax has to be paid on fill value and cafe is right in charging tax on full value. Hope your query is resolved Kindly like if my response has helped you

Deepak Rampuriwani

Deepak Rampuriwani (Querist)
Follow

07 September 2016 Service tax is charged on the consideration received or receivable from the consumer.
consideration i have paid is after discount then why to charge on full value ??

Upgrade to CAclubindia Pro. Subscribe Now!

Deepak Rampuriwani

Deepak Rampuriwani (Querist)
Follow

07 September 2016 please refer the below link for further doubt

https://www.caclubindia.com/experts/st-for-discount-allowed-391555.asp

ACA Anurag

ACA Anurag (Expert)
Follow

07 September 2016 Dear Deepak, As per my understanding govt always takes tax on gross value and not on net value Each expert have there own opinion and it may differ from other expert