Goods and Services Tax

Subscribe to Goods and Services Tax

SC Decision on Levy of GST on Ocean Freight May Act as Gamechanger

India witnessed tax revolution in 2017 when Goods and Services Tax (“GST“) was implemented to subsume existing indirect taxes on production, provision of services, sale of goods, entry, etc. The intent clearly has been to provide seamless flow of credit and avoid multiple levies on same transaction. Unfortunately, due to Integrated GST (“IGST“) payable on import of good at the transaction value, (including transport value), as well as on the procurement of transportation services as a separate supply of service, there have been instances of GST being levied twice.…

Continue Reading SC Decision on Levy of GST on Ocean Freight May Act as Gamechanger

GST

Since its implementation, the levy of the Goods and Services Tax (GST) on online games has been a point of contention due to potential revenue leakage. The first question is to determine whether online game  is actually a game of skill or a kind of gambling, whilst the second issue concerns the value of services and, as a result, the amount of GST that is required to be paid. The conundrum is exacerbated by the range of games and the possible income structures that are available. The GST Council had set up a group of ministers (“GOM”) to address the corresponding disputes and uncertainties. According to the publicly available information, a decision on the rate applicable to online games and how to value the supplies is scheduled to be published soon. The Government aims to raise the applicable rate of GST on such online games to 28 % to discourage gambling-style operandi while leaving the GST rate on learning games unchanged.…

Continue Reading ONLINE GAMES- The battle of applicable GST rate and valuation continues

GST obligations of employer on services rendered to its own employees

With re-opening of offices post the second wave of COVID-19, various employers have re-initiated providing canteen, cab, health insurance and many other services to their employees as part of welfare programme as well as obligations under various labour law regulations. The employer may choose to recover the cost of providing such services in full or offer a concession or deduct it from the concerned employees’ salaries or supply them free of cost. Surprisingly, the Goods and Services Tax (“GST”) legislation neither provides for any exemption nor declares that services rendered by the employer to its employees would not be in the nature of goods or services.…

Continue Reading GST obligations of employer on services rendered to its own employees

The conundrum created by AAR regarding GST on damages

With the ongoing pandemic, the odds of invocation of clauses such as liquidated damages, price variation clause, compensation clause or forfeiture of deposits for the delay in adhering to contractual timelines, etc. have become very high. Such additional payments could also bring out an exposure on account of taxability under Goods and Services Tax (“GST”) legislations.…

Continue Reading The conundrum created by AAR regarding GST on damages

Since its implementation on July 01, 2017, the Goods and Services Tax (GST) regime continues to evolve on various fronts by way of rationalisation of tax rates, availability of exemptions, procedural amendments, etc. While the Government has been relentless in its efforts to iron out every crease, bottlenecks continue to persist. With the benefit of hindsight, here is a critical look at some of the significant triumphs and misses on completion of its first anniversary.
…
Continue Reading GST – First Report Card