VALUATION RULES UNDER GST RELATING TO SOME SPECIFIC BUSINESS TRANSACTIONS: SERVICE OF BUYING AND SELLING OF FOREIGN CURRENCY AND SERVICE OF AN AIR TRAVEL AGENT

Abstract

The Goods and services Tax is normally levied on the value of taxable supply of goods or services. It is calculated at a percentage on value of supply. Therefore, invoice value will be the value of supply for charging GST. However, in respect of some specific businesses, the GST rules prescribe different rules for valuation. These valuation methods are optional. The supplier may, at his option, opt for valuation based on the normal valuation rules as well. Under this article comparative analysis is made between the normal and special provisions relating only to two services namely the services of buying and selling of foreign currencies including money exchange and services of an Air Travel Agents. The comparison between the normal provision and special provision reveals that in case of services of buying and selling of foreign currency, the special provisions always going to be beneficial to the tax payer. In the business of services of air travel agent, normal provisions are beneficial. There is no point in offering two schemes to businessmen for payment of GST. It is better to keep only special provisions in case of service of buying and selling of foreign currency and normal provisions in case of services of air travel agents.