A new car is purchased with a credit against the price for a vehicle that is traded in. GST is charged on the full purchase price, before the credit for the trade-in .

Question

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GST (Goods and Services Tax) is typically charged on the net amount after the trade-in value is deducted from the purchase price of the new car, not on the full price before the trade-in credit is applied.

A New Car Is Purchased with a Credit Against the Price