What does "GST extra as applicable" mean?

GST

In our country, no one knows as for when the rate of any taxes will get changed and/or a new tax/es will get imposed.

Sometimes, to counter the stiff competition, a dealer classify the product being sold under a particular heading taking the benefit of lesser taxes, against the large company classifying the same product under a different head.

Therefore in order to safeguard its interest, the dealer quote the price as rate plus applicable taxes at the time of delivery/invoicing.

When someone quotes his fees or the price of goods, he may use the words, GST extra as may be applicable. This is written in the following cases.

  1. If the rate at the time of quotation is not known to the supplier.
  2. If the supplier is not registered at the time of giving quotation but over a period of time he might have to register. Hence he clarifies that GST will be over and above the rate that he has quoted.
  3. Supplier thinks that GST rates may change between giving a quotation and making the supply. The supplier does not want to take the risk of change in the rate as this is the tax which he collects on behalf of the Govt. and deposits with the Govt.

Thus, such clause safeguards the interest of the supplier and also there are clarity and transparency in the transaction.

Read More: GST Audit Limit Guide for Taxpayers with Turnover Above 2 Crores

For example:

  • If the base price of a product is ₹1,000 and the applicable GST rate is 18%, the final amount payable will be ₹1,000 + ₹180 (GST) = ₹1,180.

This phrase is commonly used in invoices, quotations, or pricing statements to clarify that the GST component is not part of the listed price and will be charged additionally.

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