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5% ITC Rate but Output Rate is 18%

505 views 3 replies

Rohan Bagra

Chartered Accountant

91 Points Posted on 18 June 2023

We are in a business where we have some input materials which are chargeable for 5% GST. Our output product is chargeable to 18% GST.

Because of this higher rate of Output GST there is a big burden on us for high prices whereas our profit is very limited.

Is there any relief available for us in GST laws?

Replies (3)

RAJA P M

"Do the Right Thing...!!!"

128152 Points Posted on 18 June 2023

No, Sir...
....

CA SANDESH MAHIPAL

Practicing in GST and MSME

1985 Points Posted on 18 June 2023

Directly there is no relief in GST, however if you are facing true hardships, you can raise issue at GSTC level via your unions.

REGARDS

CA Altamush Zafar

GST Consultant

15986 Points Posted on 18 June 2023

There shouldn't be a burden on you since you will be getting the GST amount on outward supply from the buyers. It can prove to be a burden in the initial months but when the working capital will start to roll then there shouldn't be a problem. Reduce the credit period of your customers payment.... that will be my suggestion