Know Concept of Composite and Mixed Supply under GST


Composite supply is when two or more goods are sold in a combination, it becomes difficult to identify the rate of tax to be levied. For such goods or services, CGST Act, 2017 has provided with two terms -“Composite supply and Mixed supply”.

Composite supply is similar to the concept of “bundled service” as under service tax laws in the existing regime. Both Composite supply and Mixed supply consist of two or more taxable supplies of goods or services or both but the main difference between the two is that Composite supply is naturally bundled i.e., goods or services are usually provided together in normal course of business and cannot be separated. Whereas in Mixed supply, the goods or services can be sold separately.

Let’s take an example:

Booking of Air Tickets which involves cost of the meal to be provided during travel will be Composite supply and tax will be calculated on the principle supply which in this case is transportation through flight.

On the other hand, Diwali gift hamper which consist of different Items packed in one pack is Mixed supply as these items can be sold separately and it shall be treated as a supply of that particular item which attracts the highest rate of tax.

Disclaimer – the above article is based on our own internal information and sources. The above informations would not be applicable unless and until a related Government notification is issued in this regard. Please take expert opinion before relying on any of the information. 

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