Question

The retailer sells the cycle to a customer for a taxable value of \( \text{₹}5200 \). What is the GST payable by the retailer, given \( \text{ITC} = \text{₹}576 \)?

Options

• \[ \text{₹}624 \]

• \[ \text{₹}48 \]

• \[ \text{₹}96 \]

• \[ \text{₹}24 \]

Answer 1

\[ \text{Output tax of retailer} = 12\% \text{ of } 5200 = \frac{12}{100} \times 5200 = \text{₹}624 \] and \[ \text{GST payable} = 624 - 576 = \text{₹}48 \]. The retailer pays only the tax on the margin of \( \text{₹}400 \).