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My manufacturing facility receives a state tax exemption. Will I still receive this exemption after GST is implemented?

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My manufacturing facility receives a state tax exemption. Will I still receive this exemption after GST is implemented?
posted Nov 14, 2017 by Sumeet Vyas

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1 Answer

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It depends. Firstly, even if you do, it will now be as a credit. You will first have to pay GST, then get a credit from the state. This will impact your cash flow. Secondly, the state’s ability to continue offering exemptions will depend on how much revenue they are generating from your industry. GST is a consumption tax based on where goods are supplied to customers, not where they originate. So if most of your customers are located in other states, the state where your facility is located may not generate enough revenue to continue offering you an exemption.

answer Nov 15, 2017 by Divya Shree
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