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CMA Intermediate · Direct and Indirect Taxation · Charge of Tax including Reverse Charge

Which statement about the levy of CGST under section 9(1) of the CGST Act, 2017 is correct?

CGST is levied on all intra-State supplies of goods or services or both, except alcoholic liquor for human consumption, at rates notified on the Council's recommendation and not exceeding 20 per cent, on the value determined under section 15.

  1. ATax is levied on all intra-State supplies, including alcoholic liquor for human consumption, at a rate not exceeding 20%
  2. BTax is levied on all intra-State supplies except alcoholic liquor for human consumption, at rates notified on the Council's recommendation not exceeding 20%Correct
  3. CTax is levied only on intra-State supplies of goods, at a rate not exceeding 40%
  4. DTax is levied on intra-State supplies, and the rate is fixed in the Act itself at 20%

Explanation

Section 9(1) levies CGST on all intra-State supplies except alcoholic liquor for human consumption (and the specified spirit used to make it). Rates are notified on the Council's recommendation, with a ceiling of 20%. The 40% ceiling belongs to IGST, and the rate is not fixed in the Act.

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