GST was launched as a revolutionary tax system in India on July 1st, 2017. It brings many changes in almost every sector of the economy of the country. This also includes the second-hand goods industry. There is a new term called ‘Margin Scheme’ in GST which not many people are aware of yet.
Let’s find out more about it.
What is Margin Scheme under GST?
The Margin Scheme in GST is applicable on the supply of second-hand goods. In normal cases, the GST tax is applicable in the actual transaction value of the supply, but for second-hand items, the GST will be levied only on the margin value, i.e. the profit margin of the seller (the difference between purchase price and selling price).