In economics, zero-rated supply refers to items subject to a 0% VAT tax on their input supplies. The term is applied to items that would normally be taxed under valued-added systems such as Europe's Value Added Tax or Canada's Goods and Services Tax.

What is zero-rated supply in GST?

What is Zero Rating? By zero rating it is meant that the entire value chain of the supply is exempt from tax. This means that in case of zero rating, not only is the output exempt from payment of tax, there is no bar on taking/availing credit of taxes paid on the input side for making/providing the output supply.

What do you meant by zero-rated supply?

Zero-Rated Supply means goods and services sold by the companies are free from Goods and Services Tax (GST). No GST will be charged on these goods & services. For company and business, GST paid on the assets, purchases or expenses for their businesses can be claimed as Input Tax Credit.