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A manufacturer sells a washing machine to a wholesaler for Rs 15000. The

wholesaler sells it to a trader at a profit of Rs 1200 and the trader sells it to a

consumer at a profit of Rs 1800. If all the sales are intra-state and the rate of GST is

12%, find:

(i) The amount of tax (under GST) received by the State Government from the

wholesaler.

(ii) The amount of tax (under GST) received by the Central Government from the

trader.

(iii) The amount that the consumer pays for the machine.

Answer:

It is a case of intra-state transaction of goods and services.

SGST = CGST = ½ GST

Given:

CP of washing machine for wholesaler = ₹15000

Rate of GST = 12%

Amount of GST paid by wholesaler to manufacturer,

CGST = SGST = 6% of ₹15000

= (6/100) × 15000

= ₹900

SP of washing machine by wholesaler to trader = CP + profit

= ₹15000 + ₹1200

= ₹16200

Amount of GST paid by trader to wholesaler,

CGST = SGST = 6% of ₹16200

= (6/100) × 16200

= ₹972

(i) The amount of tax (under GST) received by the State Government from the

wholesaler.

₹972 - ₹900 = ₹72

(ii) The amount of tax (under GST) received by the Central Government from the trader.

SP of washing machine for trader to consumer = CP of washing machine + profit

= ₹16200 + ₹1800

= ₹18000

Amount of GST paid by the consumer to trader,

CGST = SGST = 6% of ₹18000

= (6/100) × 18000

= ₹1080

Amount of GST received by the Central Government from the trader = ₹1080 - ₹972

= ₹108

(iii) The amount that the consumer pays for the machine.

CP of washing machine for consumer + CGST paid by consumer + SGST paid by

consumer = ₹15000 + ₹1080 + ₹1080 = ₹17160

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