Assuming the Product sale chain is as follows: from manufacturer → to wholesaler → to retailer → to consumer.
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Product Manufacturer:
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Wholesaler:
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Retailer:
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Consumer:
Manufacturer buys raw materials from a supplier and pays GST on the bill value. He produces/manufactures the finished goods and sells it charging GST on the bill issued to wholesaler.
While remitting the tax collected, the manufacturer claims the credit (set off) of GST already paid by him on raw material/inputs. (This process of taking credit is called Input Tax Credit/ITC) and remits the balance to Government.
Next in line is the Wholesaler, who buys from Manufacturer and pays GST on the purchase. He then adds some value to it (Service cost for providing facilities such as storing, logistics, re-packaging costs and his margin) and then sells the goods to retailer and charges GST.
While remitting the tax collected to the Government, he is eligible to Claims ITC of the GST he paid to manufacturer and remits the balance to Government.
Now comes into scene the Retailer. The Retailer buys from the wholesaler and pays GST on the purchase value. He adds some value to the goods (service cost for providing facilities like running an accessible store, customer service, after-sale support, warranty support, providing shopping experience etc and his margin) and then finally sells it to customer and collects GST on the sale he made.
While remitting the tax collected to the Government, he is eligible to Claims ITC of the GST he paid to wholesaler and remits the balance to Government.
Finally the Goods reaches the hands of consumer. The consumer pays GST on final price. But he being the end user of the goods, he cannot claim ITC. The End consumer bears the tax.