Discounts and free offers given by merchants/sellers on the products & services provided to their customers have been included under the Goods & Services Tax (GST) system. Many merchants or manufacturers offer discounts on their offerings as a marketing strategy to increase the sales of these products/services.
GST, which was implemented on July 1, 2017 as a unified indirect tax system in India, has provisions for the levy of tax on the cash discount and other discounts offered by sellers on their supplies. GST on discount has been divided into the following two types.
