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27 Jul 2018

Gist of Amendments in GST applicable w.e.f. 27th July 2018

Recently, the GST Council has recommended several changes to be made in its 28th GST Council meeting concluded on 21st July, 2018.

The changes recommended by GST council have been notified by the Ministry of Finance vide issuance of Notifications on 26th July, 2018.

Applicable w.e.f. 27th July, 2018
  1. Changes related to Rates
  2. Changes related to Exemption
  3. Changes related to Reverse Charge Mechanism
  4. Major Relief for Textile Sector
1. Changes related to Rates GST rates of several services have been clarified vide Notification No. 13/2018- Central Tax (Rate). The list of services whose rates have been revised are provided below-  
Sno. Description of service New rates
1.

Supply by way of Supply, by way of or as part of any service, of goods, being food or any other article for human consumption or any drink provided by a restaurant, eating joint including mess, canteen, whether for consumption on or away from the premises. Recently, an explanation has been inserted to include the supply at a canteen, mess, cafeteria or dining space of an institution such as a school, `college, hospital, industrial unit, office, by such institution or by any other person based on a Contractual arrangement with such institution for such supply, provided that such supply is not event based or occasional.

2.5
2.

Supply, of goods, being food or any other article for human consumption or any drink, by the Indian Railways or Indian Railways Catering and Tourism Corporation Ltd. or their licensees, whether in trains or at platforms. Provided No ITC on goods and services used for providing such services shall be allowed.

2.5
3.

Supply, by way of or as part of any service, of goods, being food or any other article for human consumption or any drink, at Exhibition Halls, Events, Conferences, Marriage Halls and other outdoor or indoor functions that are event based and occasional in nature.

9
4.

Multimodal transportation of goods

“multimodal transportation” means carriage of goods, by at least two different modes of transport from the place of acceptance of goods to the place of delivery of goods by a multimodal transporter.

6
5.

Supply consisting only of e-book. “ebooks” means an electronic version of a printed book (falling under tariff item 4901 in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975)) supplied online which can be read on a computer or a hand held device.

2.5
  2. Changes related to Exemptions Notification No. 14/2018 –Central Tax (rate) has been issued to amend Notification No. 12/2017-CT (rate) 28th June, 2017dated which provides list of services exempted from payment of whole of GST under the CGST Act, 2017 and IGST Act, 2017.   A. Scope of exemption widen
  1. Services by way of transportation of goods by an aircraft from customs station of clearance in India to a place outside India upto 30th September, 2018. Now exended up to 30th September, 2019 (Entry 19A)
  2. Services by way of transportation of goods by a vessel from customs station of clearance in India to a place outside India upto 30th September, 2018. Now extended up to 30th September, 2019 (Entry 19B)
  3. Services of Re-insurance of the insurance schemes provided to the Central Government, State Government, Union territory under any insurance scheme for which total premium is paid by the Central Government, State Government, Union territory (i.e. insurance scheme exempted under (Entry 40).
B. New exemptions
  1. Services by an old age homes run by Central Government, State Government or entity under section 12AA of the Income Tax Act, 1961, to residents for consideration upto Rs. 2500 per month per member. (Entry 9D)
  2. Services by Electricity distribution utilities for construction, erection, commissioning, or installation of infrastructure for extending electricity distribution network upto the tube well of the farmer or agriculturalist for agricultural use. (Entry 10A)
  3. Service by way of Services by way of warehousing of minor forest produce. (Entry 24A)
  4. Services by Coal Mines Provident Fund Organisation to persons governed by the Coal Mines Provident Fund and Miscellaneous Provisions Act, 1948 (Entry 31A)
  5. Services by National Pension System (NPS) Trust to its members against consideration in the form of administrative fee. (Entry 31B)
  6. Services by Central Government, State Government, Union territory to their undertakings or Public Sector Undertakings (PSUs) by way of guaranteeing the loans taken by such undertakings or PSUs from the financial institutions.
  7. Services by way of licensing, registration and analysis or testing of food samples supplied by the Food Safety and Standards Authority of India (FSSAI) to Food Business Operators.(Entry No. 47A)
  8. Artificial insemination of livestock (other than horses). (Entry no. 55A)
  9. Services supplied by a State Government to Excess Royalty Collection Contractor (ERCC) by way of assigning the right to collect royalty on behalf of the State Government on the mineral dispatched by the mining lease holders. (Entry No. 65B)
  10. Services by an unincorporated body or a non-profit entity registered under any law, to its own members against consideration in the form of membership fee upto an amount of Rs 1000/- per member per year.
Where such an unincorporated body or a non-profit entity is engaged in (i) activities relating to the welfare of industrial or agricultural labour or farmers; or (ii) promotion of trade, commerce, industry, agriculture, art, science, literature, culture, sports, education, social welfare, charitable activities and protection of environment. 3. Changes related to Reverse Charge Mechanism The Central Government vide Notification No. 15/2018-Central Tax (Rate), services provided by an individual direct selling agents other than a body corporate, partnership or LLP to a banking company or a NBFC located in the taxable territory has been brought under the ambit of Reverse charge mechanism. Therefore, w.e.f. 27th July, 2018, a banking company or a NBFCs located in the taxable territory shall be liable to pay GST on such services.

4. Major Relief for Textile Sector Vide Notification No. 20/2018-Central Tax(rate), the refund of unutilized input tax credit shall be allowable, where the input tax credit has accumulated on supplies received on or after 1st August, 2018 on account of rate of tax on inputs higher than the rate of output supplies, in respect of the following goods

i. Woven fabrics of silk or of silk waste

ii. Woven fabrics of wool or of animal hair

iii. Woven fabrics of cotton

iv. Woven fabrics of other vegetable textile fibres, paper yarn

v. Woven fabrics of manmade textile materials

vi. Woven fabrics of manmade staple fibres

vii. Knotted netting of twine, cordage or rope; made up fishing nets and other made up nets, of textile materials

viii. Corduroy fabrics

ix. Narrow woven fabrics, other than goods of heading 5807; narrow fabrics consisting of warp without weft assembled by means of an adhesive (bolducs)

x. Knitted or crocheted fabrics (All goods)

However, accumulated unutilized input tax credit after payment of tax for and upto July, 2018 on supplies received up to 31st July 2018 shall be lapsed.