Question

A shopkeeper buys an article in Maharashtra at the printed price of ₹ 40,000 from a wholesaler in M.P. The shopkeeper sells the article to a consumer in Maharashtra at a profit of 15% on cost price. If the rate of GST is 12%, find: 

1. the price inclusive of tax (under GST) at which the shopkeeper bought the article.
2. the amount which the consumer pays for the article.
3. the amount of tax (under GST) received by the State government to Maharashtra.
4. the amount of tax (under GST) received by the Central government.

Answer 1

(i) Cost Price for the shopkeeper = ₹ 40,000

IGST amount = 12% of ₹ 40,000 

= `40,000xx12/100`

= ₹ 4,800 

Price inclusive of tax paid by the shopkeeper = Cost Price + IGST Amount

= 40,000 + 4,800

= ₹ 44,800

(ii) Selling Price (exclusive of GST) for the shopkeeper = Cost Price + Profit 

= 40,000 + (15% ₹ 40,000) 

= 40,000 + `(40,000xx15/100)`

= 40,000 + 6,000

= ₹ 46,000

Total GST on the selling price = 12% of ₹ 46,000

= `46,000xx12/100`

= ₹ 5,520

Amount the consumer pays (inclusive of GST) = Selling Price + Total GST

= 46,000 + 5,520

= ₹ 51,520

(iii) Total GST received by the State Government of Maharashtra = `"Total GST"/2`

= `5520/2`

= ₹ 2,760