It is passed down the chain to consumers who ultimately bear the tax, while business gets input credits or refunds of GST paid. Under the GST goods and services will be either taxable, input taxed or GST-free. Existing wholesale sales taxes are levied on a narrow range of goods only, and do not apply to services, at rates ranging between 12 and 45 per cent. WST is levied when wholesalers sells their goods, and are hidden in the price of goods at the checkout. A narrow range of goods which are taxed requires higher levels of tax to raise a given amount of revenue.
Sales tax is passed on in prices to final consumers.
Under the VAT system, the GST is applied on goods at each stage of their production. Individuals are not refunded the tax, leaving them to pay the full 10 per cent. If a supply is GST-free, no GST is payable on the supply and you are entitled to input tax credits on your creditable acquisitions that relate to the supply. Residential rents and financial services are often exempted because no value is added by the final supplier. No GST should be passed to final consumers.