Introduction:
The GST Act came in force from 1st July, 2017. There were many interpretation issues with respect to the definitions, glossary and terms use in the law. Since, such definitions were adopted from various legacy laws in India prior to GST; such as Service Tax, State VAT, Central Excise Act, Luxury Tax, Entertainment Tax, etc. it was difficult to make applicable one definition for different sectors. Hence, some modifications from existing definitions were made. Therefore, it was important to established a nexus of the terms used in the GST definitions. The definition discussed here is”Output Tax”.
So what do you mean by “Output Tax”?
Section 2(82) of CGST Act, 2017 – “output tax” in relation to a taxable person, means the tax chargeable under this Act on taxable supply of goods or services or both made by him or by his agent but excludes tax payable by him on reverse charge basis;
Conclusion:
Hence it is understood that the tax chargeable under this Act on taxable supply of goods or services or both made by him or by his agent but excludes tax payable by him on reverse charge basis; is known as “output tax”.