As we all know Govt. of India is going to replace existing taxes with Goods and Service Tax (GST).So the question arises that,“How GST will affect the prices of Gadgets,Sofware and IT Services?”.
The impact of GST on various electronics will vary, with many products such as mobiles, computers, and televisions likely to become more expensive.
But why are companies coming up with pre-GST sales? The answer lies in tax credits. When retailers buy products, they get tax credit, which can be adjusted against the tax they need to pay when they sell the said goods. Post-GST, the tax they will need to pay on electronics when they are sold will go up, while their tax credit for inventory they already have will remain the same. This means they will end up paying the difference out of their pocked.
“For example, for a Rs. 1000 product purchased pre-GST, the input tax we got credit for will be Rs. 50 at 5 percent rate. But post-GST, when we sell, if we have to pay 12 percent tax – which is Rs. 120 – we cannot charge the difference to the customers, and will need to pay out of our own pocket,”.
So one more question arises here is that,whether we have to pay GST even if we are selling an old phone online or offline?
If you are planing to sell your mobile phone online via some websites like OLX,Quikr and if you prefer offline payment it will not come under GST.