India Customs Agency Issues Circular Clarifying Treatment of Secondary, Post-Sale Discounts for GST

The Indian Central Board of Excise and Customs Sept. 12 issued Circular No. 251/08/2025-GST, clarifying the treatment of secondary or post-sale discounts for GST. The circular includes FAQs providing: 1) the eligibility criteria for full input tax credit (ITC) when recipients make discounted payments and suppliers issue financial or commercial credit notes; 2) confirmation that recipients don’t need to reverse ITC on discounted payments since the original transaction value and tax liability remain unchanged; 3) clarification that post-sale discounts from manufacturers to dealers aren’t treated as consideration for services, unless a specific agreement with the end customer makes the discount ...