Question

A manufacturer sold a cycle for a taxable value of \( \text{₹}4000 \) to the wholesaler. If the rate of GST is \( 12\% \), what is the output tax of the manufacturer?

Options

• \[ \text{₹}480 \]

• \[ \text{₹}576 \]

• \[ \text{₹}624 \]

• \[ \text{₹}96 \]

Answer 1

\[ \text{Output tax of manufacturer} = 12\% \text{ of } 4000 = \frac{12}{100} \times 4000 = \text{₹}480 \]. Since the manufacturer has no input tax, the whole \( \text{₹}480 \) is the GST payable at this stage.