GST Impact on Traders, Find Complete Details for GST Impact on Traders. Check Impact of GST on Traders. GST Bill is passed in Lock Sabha and Rajya Sabha and it is expected to be applicable on whole India from 1st July 2017. We already provided GST Registration Procedure and now Everyone want to know about Impact of GST on there business so in this series today we provide complete analysis for GST Impact on Traders. Check complete details form below….

GST Impact on Traders

(a) Tax on value addition: The impact of tax on the wholesaler or retailer would be limited to the value addition. The tax paid at earlier stages (except CGST & SGST of other States) would be available as set off for payment of GST on supplies. Therefore, traders would prefer to buy/receive supplies with invoice pre-and post GST.

(b) Reduce cascading: Cost of products and services would reduce normally due to the cascading effect of tax being reduced. Service tax credits would be available and going forward even the capital goods used for storing, handling etc.

(c) SGST levy: CGST and SGST would be levied on the local supply of goods within State. IGST (comprising of CGST and SGST) would be levied on inter-State supply of goods.

(d) No subsequent sale or sale in transit under the CST Act against Forms E-1/2: This exemption as per section 6(2) of the CST Act is not continued under GST levy. GST would be charged on both transactions.

(e) Export supplies Under Form H/ Supplies to SEZ under form I: Not available.


(f) Stock transfers: Presently, stock transfer is done without charging CST against Form F. Under GST law, stock transfers from one State to other would be liable to GST.

(g) Stock transfers to branches/consignment agents within the State: Under GST, these transfers would not be taxed as the registration number of transferor and transferee is same. Where the division/ branch or agent has a different registration CGST & SGST would be charged.

(h) Small Traders: They would be eligible for the composition scheme upto Rs 1.5 Crore provided their aggregate turnover in the preceding financial year did not exceed Rs. 50 lakh. After that, normal rate will apply. The essential conditions to be complied for availing the benefit of the aforesaid Composition Scheme are as under

  • (i) No credit to dealer/ customer;
  • (ii) No inter-state supply of goods.

Only suitable for Business to Consumer transactions.

  • (i) Reduction in multiplicity of taxes
  • (ii) Mitigation of cascading/double taxation
  • (iii) More efficient neutralization of taxes especially for exports
  • (iv) Development of common national market
  • (v) Simpler tax regime-fewer rates and exemptions

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