A dealer in Delhi buys an article for 16000 from a wholesaler in Delhi. He sells the
article to a consumer in Rajasthan at a profit of 25%. If the rate of GST is 5%, find:
(1) the tax (under GST) paid by the wholesaler to Governments.
(ii) the tax (under GST) paid by the dealer to the Government.
(iii) the amount which the consumer pay for the article.?

Cost price of the article for the dealer = 16000

As the sales are interstate the GST will go the central government

GST = (5/100) × 16000

= ₹800

The article is sold at a profit of 25% to a consumer

Profit = (25/100) × 16000

= ₹4000

Thus, the selling price of the article = 16000 + 4000 = ₹20000

As the sales are interstate, then

GST = 5/100 × ₹20000

= ₹1000

(i) The tax paid by the wholesaler to the governments

= ₹800/2

= ₹400

Thus, CGST = ₹400 and SGST = ₹400

(ii) The tax paid by the dealer to the governments

= IGST = ₹1000 – ₹800 = ₹200

(iii) Total amount paid by the consumer for the article

= 20000 + 1000

= ₹21000

Regards.