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Composition dealer liability on exempt goods

08 July 2020

One of my friend is a composition dealer, previously supply of Coke, now he is want to supply of salt also...

whether is liable to tax even supply of exempt goods(what is the treatment on supply of Salt if supplier is composition dealer)

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6 Replies

CA ABHAY GUPTA (Practice) (3230 Points)
Replied 08 July 2020

Tax of 1% is payable even on exempted goods also

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chethan data (298 Points)
Replied 08 July 2020

Hi sir but trader of goods registered as a composition dealer in GST is not required to pay GST on sale of Exempted goods. Refer notification no. 01/2018 (

CA ABHAY GUPTA (Practice) (3230 Points)
Replied 08 July 2020

Can you please share the notification as I cannot see such thing mentioned in that notification

chethan data (298 Points)
Replied 08 July 2020

Sir notifications no. 1/2018 central tax

Shivam RC (Student) (23683 Points)
Replied 08 July 2020

No Chethana Kumar. The Composition Dealer ( TRADER ) is not required to pay tax on Exempt Supply ( Salt in your case ).

As per Notification No. 1/2018 - Central Tax, dated 01.01.2018 ( amending the Principal Notification No. 8/2017 - Central Tax, dated 27th June 2017), the Traders who have opted for Composition Scheme need to pay “half percent of the turnover of TAXABLE SUPPLIES of Goods."

Therefore the trader is required to pay 1% GST on their Taxable Supplies of Goods.

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