I have never understood this so may be someone can shed a light. You see there are several food outlets that come up with promotion e.g. Buy 1 and get another at 50%!
But the thing is you have to pay full tax on that another item which is priced at 50%. In fact in many cases it is Buy 1 and Get 1 free but you have to pay full tax on that free item. What kind of logic is that? I mean the tax is paid on selling price and if my maths is right than (assuming GST is 17%)
0 X 17% = 0
So whatever the GST rate is, when something is multiplied by zero then end result is always zero!
Why do we have to pay full tax on items which are free?