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Exchange offers to become less attractive under GST

Updated on: Jul 21st, 2021

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2 min read

3rd April, 2017 Exchange offers will become less attractive under GST as the tax will be applicable on the value of the good, and not the cash amount paid after reduction. As described in the draft valuation rules released by the government, GST will be applicable only on the price of the item. This expected to affect the consumer electronics and durables where exchange offers are common. Currently, a buyer pays VAT on the cash transaction and not on the barter value of the goods. As reported in Live Mint.

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Under GST, exchange offers will be less attractive as tax applies to the item's value not the cash paid, affecting consumer electronics. Currently, VAT is paid on cash transactions, not barter value. This change is expected to impact the electronics and durables market.

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