The Union Finance Minister Arun Jaitley-headed GST Council has recommended many relief measures regarding GST rates on goods and services covering many sectors and commodities. The Council has also recommended issuance of certain clarifications on issues relating to GST rates and taxability of certain goods and services.
- No GST will be levied on RTI services
- The GST council also exempted legal services provided to Government
- The GST Council reduced tailoring service from 18% to 5%
Changes relating to GST rates on certain services
1. The GST Council decided to extend GST exemption on Viability Gap Funding (VGF) for a period of 3 years from the date of commencement of RCS airport from the present period of one year.
2. The GST Council decided to exempt supply of services by way of providing information under RTI Act, 2005 from GST.
3. The council exempted legal services provided to Government, Local Authority, Governmental Authority and Government Entity.
4. The Council reduced GST rate on construction of metro and monorail projects (construction, erection, commissioning or installation of original works) from 18% to 12%.
5. The council decided to reduce GST rate on tailoring service from 18% to 5%.
6. The GST Council decided to reduce GST rate on services by way of admission to theme parks, water parks, joy rides, merry-go-rounds, go-carting and ballet, from 28% to 18%.
7. The Council exempted service by way of transportation of goods from India to a place outside India by air. The council also exempted service by way of transportation of goods from India to a place outside India by sea and provide that value of such service may be excluded from the value of exempted services for the purpose of reversal of ITC.
8. The Council also reduced GST rate (from 18% to 12%) on the Works Contract Services (WCS) provided by sub-contractor to the main contractor providing WCS to Central Government, State Government, Union territory, a local authority, a Governmental Authority or a Government Entity, which attract GST of 12%. Likewise, WCS attracting 5% GST, their sub-contractor would also be liable at the rate of 5%.
9. The Council raised the exemption limit of Rs 5,000 per month per member to Rs 7,500 in respect of services provided by Resident Welfare Association (unincorporated or nonprofit entity) to its members against their individual contribution.
10. The Council reduced GST rate on transportation of petroleum crude and petroleum products (MS, HSD, ATF) from 18% to 5% without ITC and 12% with ITC.
11. The GST Council exempted dollar denominated services provided by financial intermediaries located in IFSC SEZ, which have been deemed to be outside India under the various regulations by RBI, IRDAI, SEBI or any financial regulatory authority, to a person outside India.
12. The GST Council reduced job work services rate for manufacture of leather goods (Chapter 42) and footwear (Chapter 64) to 5%.
13. The GST Council exempted services relating to admission to, or conduct of examination provided to all educational institutions, as defined in the notification.
14. The GST Council exempted services by educational institution by way of conduct of entrance examination against consideration in the form of entrance fee.
15. The GST Council enhanced the limit to Rs 2 lakh against Sl. No. 36 of exemption notification No. 12/2017-C.T. (Rate) which exempts services of life insurance business provided under life micro insurance product approved by IRDAI upto maximum amount of cover of Rs. 50,000.
16. The GST Council reduced GST on Common Effluent Treatment Plants services of treatment of effluents, from 18% to 12%.
17. The GST Council reduced the GST rate to 12% in respect of mining or exploration services of petroleum crude and natural gas and for drilling services in respect of the said goods.
18. The GST Council exempted subscription of online educational journals/periodicals by educational institutions who provide degree recognized by any law from GST.
19. The GST Council exempted the service provided by way of renting of transport vehicles provided to a person providing services of transportation of students, faculty and staff to an educational institution providing education upto higher secondary or equivalent.
20. The GST Council decided to tax time charter services at GST rate of 5%, that is at the same rate as applicable to voyage charter or bare boat charter, with the same conditions.