GST Reform 2025: Businessmen will be very happy with this rule of GST, this is how they will get huge benefits!

GST Reform 2025: For a long time, there was a question in the minds of businessmen whether GST will be levied on the full price or the price after the discount on the discount given to the dealers. Now the government has brought clarity in this matter and made it clear that if a company gives a direct discount to its dealer on any goods, then GST will now be levied on that reduced price. Earlier tax officials used to say that the tax would be applicable on the full price, but the new rules have put an end to this confusion. For example, if a car company sells the old model to the dealer for ₹ 18,00,000 instead of ₹ 20,00,000, then now GST will be applicable only on ₹ 18,00,000.

When will the new rule come into effect?

This rule will come into effect from September 22, 2025, when the new GST rules will come into effect. Recently, a decision was taken on this in the GST Council meeting. After this, the Central Board of Indirect Taxes and Customs (CBIC) has issued a circular in this regard. This circular has made it clear to companies and dealers how GST will be calculated under which circumstances.

Benefit will not be available on every discount

This discount will be valid only when there is a direct agreement between the company and the dealer. That is, the benefit of the discount will be available only when the company clearly tells the dealer in a written or predetermined manner to sell the goods at a lower price. If the discount is given through a third party, such as a distributor, then GST will be applicable on the full price. In this way, this benefit will be applicable only when there is a direct transaction between the company and the dealer.

End of old disputes

Earlier there was often a debate between companies and tax officials regarding GST. Officials used to say that no matter how much the discount is, tax will be levied on the full price, while the companies argued that when the goods have been sold at a lower price, then tax should also be levied on the same basis. This new decision of the government has resolved this old dispute. This will not only provide relief to businessmen, but will also increase transparency in the tax system.

What should businessmen do?

Companies have to ensure that the discount agreement with the dealers is straightforward and in writing. This will avoid any kind of dispute in the future and GST calculation will be done easily. Abhishek Jain, tax expert of KPMG India, has called this decision welcome. According to him, this step will help companies, distributors and dealers to transact with more clarity. Also, old disputes going on for years will also gradually end.