Dear Patrons,

The GST Council has finalised Valuation Rules and the related provisions for determination of value of supply under GST regime.  
GST would normally be payable on the ‘transaction value’, which is the price actually paid or payable for supply of goods and/or services where the supplier and the recipient are not related and price is the sole consideration of supply.

Inclusions:
Value of supply shall also include:

Taxes other than GST

Expenses incurred by recipient in relation to supply

Incidental expenses charged at the time of or before the supply. E.g. packing charges

Interest, penalty etc. for late payment of consideration

Subsidies directly linked to the price excluding subsidies provided by Central and State Government

Exclusions :
Discounts given before or at the time of supply and duly recorded in the invoice shall not be included in the value of supply.
Post-supply discounts shall be excluded from the value of supply provided:

it is identified at the time of agreement

linked to the relevant invoice

ITC attributable to the discount has been reversed by the recipient of supply 

When the supply of goods and/or services is for a consideration not wholly in money or when the supplier and the recipient are related, then the value of supply shall be determined in accordance with Valuation Rules prescribed under GST which are as follows:
Where consideration is not wholly in money:

Open market value

Sum total of money consideration and further equivalent amount

Value of supply of goods/services of like kind and quality

110% of cost

Reasonable value

Supply of goods and/or services between distinct or related persons:

Open market value

Value of supply of goods/services of like kind and quality

110% of cost

Reasonable value

Supply of goods through agent:

Open market value or 90% of the price charged for goods of like kind and quality by the recipient to its customer

110% of cost

Reasonable value

Supply of services in case of pure agent:
Expenditure or costs incurred by the supplier as a pure agent of recipient of services shall be excluded from value of supply subject to prescribed conditions.