GST rates, Exemptions and Services covered under reverse charge

GST Council finalizes GST rates, exemptions and services covered under reverse charge

Dear Professional Colleague,

The 14th Goods and Services Tax (GST) Council Meeting, chaired by the Union Minister of Finance Shri Arun Jaitley, was held in Srinagar, Jammu and Kashmir. On the first day of the meeting, the Council has broadly approved the GST rates for goods at nil rate, 5%, 12%, 18% and 28%. The Council has also broadly approved the rates of GST Compensation Cess to be levied on certain goods.

On the second day of its meeting, the GST Council finalised the fitment of various services into the GST rate slabs of 0%, 5%, 12%, 18% and 28%. In addition, GST Council has approved a list of services continued to be exempt under GST, the list of services covered under reverse charge mechanism and the new scheme for classification of goods.

Some of the key highlights are:

A.     GST Rates for Goods:

Tax Rate	Product
Nil	Live animal, Milk, curd, lassi, buttermilk, Fresh vegetables, Fresh fruits(other than in frozen state),Cereals(other than bearing a registered brand name), Flour, Aata, Maida, Besan (other than bearing a registered brand name), Pappad and bread(branded or not), Prasadam supplies by religious place, Coconut powder, Water [other than aerated mineral purified distilled),Common Salt, Human blood, Organic manure, Kumkum, sindur, bindi, alta, clinical waste, Plastic bangles, Printed books, Passenger bags.
5%	Yogurt, Fresh fruits in frozen state, Coffee, tea, Vegetable fats and oils, Khandsari sugar, Pizza bread, seviyan, Rusks, Tobacco leaves, Salt other than common salt, Ores and concentrates (e.g. Iron, copper, Nickle, cobalt etc.), Handmade safety matches, Vaccines, Brochures, leaflets, Broomsticks and Muddhas.
12%	Live horses, Frozen meat in unit containers, Butter, ghee and cheese, Dry fruits, Fruit Juice, fruit juice based drinks, Ice and snow, Marble block, granite block, Iodine, Candles, photographic plates and films for x-ray for medical use, Tractors, bicycles, Children’s picture, drawing or colouring books, Fertilizers, fountain pen ink, ball pen ink, Tooth powder, aggarbati, Feeding bottles, Umbrella, Utensils, Tables or kitchen or other household articles, Telephones for cellular networks, Sports goods.
18%	Refined sugar, Pasta, corn flakes, pastries and cakes, Instant tea, tea aroma, Sauces, Soups, Ice cream, Sharbat, Supari, Ethyl alcohol, Vinegar, Hair oil, Soap, Insecticides, rodenticides, herbicides Electric motors and generators, Electronic Toys like tricycles, scooters.
28%	Molasses, Chewing gum, bubble gum and white chocolate, Custard powder, Pan masala, Aerated waters, Marble and granite other than block, Perfumes, beauty or make-up preparations, shampoo, hair cream, Toothpaste, Fireworks, Cars.

B.     Rates for Services:

Tax Rate	Condition	Nature of Service
5%	With ITC of input service	Goods transport by rail, passenger transport by rail (other than sleeper class), Transport of goods in a vessel from place outside India to custom station, Passenger by air in economy class (in normal airport), Passenger by air in regional connectivity scheme airport, Leasing of aircraft(scheduled airlines+ scheduled operation)
	Without ITC	GTA for goods and used household goods, Renting of Motorcab, passengers  transport by AC contract/stage carriage (other than motorcab) and radio taxi, tour operator
	With full ITC	Advertisement in print media, Job work in relation to printing of newspaper
12%	With ITC of Input Service	Foreman of chit fund
	With full ITC	Goods transport in containers by rail by any person other than Indian Railways, Passenger transport by air(other than economy), Restaurant(NON AC+ No license to serve liquor),Hotel(room tariff-Rs 1000 and above but less than 2500 per room per day), Construction service(value of land included)*,Transfer of intellectual property(no right to use) *no refund of overflow of ITC
18%	With full ITC	Restaurant having AC or serving liquor, outdoor catering,Hotel (room tariff more than Rs 2500 above and less than Rs 5000 per room per day), Bundle of food/drinks along with shamiana, pandal, Admission to circus, Indian classical dance,theatre, drama, Composite works contract, All services not specified elsewhere(Residuary entry)
28%	With full ITC	Admission to entertainment/amusement facility, Service by race club, Gambling, AC Restaurant in 5 stars or above-rated hotel, Hotel(room tariff above Rs. 5000 per night per room)
	No ITC	Renting of motor cab(if fuel cost borne by SR)
Same rate of GST & compensation cess as on supply of similar goods	With full ITC	Transfer of right to use goods(for those goods which attract same GST burden &  compensation cess as on sale of goods),Transfer of right in goods or undivided share in goods w/o transfer of title(for those goods which attract same GST burden &  compensation cess as on sale of goods), Transfer of title in goods in which property shall pass at a future dateupon payment of full consideration(value of leasing service shall be included in value of goods supplied)

C.     Services Exempt from GST: Broadly all services presently covered under Negative List and Mega Exemption Notification are kept under the exemption.

D.      

E.     Services covered under RCM (100% reverse charge):

a.     Services imported other than online information and database access and retrieval services provided to non-assessee.

b.     Services provided by GTA to specified persons.

c.     Legal Services provided by advocates to the business entity.

d.     Services provided by the Arbitral tribunal to the business entity.

e.     Sponsorship services provided to the body corporate or partnership firm.

f.      Services (excluding few) provided by the government to the business entity.

g.     Services provided by Director to company or body corporate.

h.     Services provided by the insurance agent to the insurance company.

i.      Services provided by recovery agent to banking company.

j.      Transportation of goods by a vessel from a place outside India up to the customs station of clearance in India provided person located in a non-taxable territory.

k.     Services of transfer or right to use of copyright by author, music composer, photographer, artist etc to publisher, music company, producer.

l.      Radio taxi or Passenger Transport Services provided through electronic commerce operator.

The Council is yet to conclude on the rate of tax on gold and other precious metals, packaged food, textile, cigarettes and footwear.

Hope the information will assist you in your Professional endeavours.

http://fkrt.it/mufSp!NNNN