INDUSTRY WISE ANALYSIS OF GST RATE NOTIFICATIONS APPLICABLE FROM 1ST OCTOBER 2021

[Vivek Jalan]

Notification No. 06/2021 - Central Tax (Rate)

1. Works Contract Service for Charitable Organizations -

GST @12% would be charged on Works Contract by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of a building owned by an entity registered under section 12AA 70[or 12AB] of the Income Tax Act, 1961 (43 of 1961), which is used for carrying out the activities of providing, centralised cooking or distribution, for mid-day meals under the mid-day meal scheme sponsored by the Central Government, State Government, Union territory or local authorities –

Post 31.3.2022 incase where such a charitable organization does not get itself registered u/s 12AB of Income Tax Act, it will not be eligible for this 12% GST Rate benefit also.

2. Transfer of IPR related to IT Software to be liable to be charged GST at 18%

Vide amendment to item Sl 17 (i) & (ii) of N No 11/2017 – Central Tax (R) vide N No 6/2021 – Central Tax (R)

3. Alcohol Industry

- Services by way of job work in relation to manufacture of alcoholic liquor for human consumption will be now taxable @18%. The categorization of the said services as a job work under food products will now have to be discontinued. However, it seems that the amendment shall be applicable from 1.10.2021 only vide amendment to item Sl 26 (ica) & other entries of N No 11/2017 – Central Tax (R) vide N No 6/2021 – Central Tax (R)

4. Printing Industry -

Services by way of printing of all goods falling under Chapter 48 or 49 [including newspapers, books (including Braille books), journals and periodicals], which attract CGST @ 6 per cent. or 2.5per cent. or Nil, where only content is supplied by the publisher and the physical inputs including paper used for printing belong to the printer to also be taxed at 18% instead of earlier 12% vide amendment to item Sl 27 (i) & (ii) of N No 11/2017 – Central Tax (R) vide N No 6/2021 – Central Tax (R)

5. Entertainment & Amusement –

Any entry to a place which even has casinos or race clubs will be taxable at 28% and not 18% vide amendment to item Sl 34 (iii) & (iiia) of N No 11/2017 – Central Tax (R) vide N No 6/2021 – Central Tax (R)

6. Transport –

Multimodal Transport of goods from a place in India to another place in India to be classified under SAC 996541. Possibly this is done to identify multimodal transport separately and track E-Waybills and other documents accordingly.

Notification No. 07/2021 - Central Tax (Rate)

1. Service to or by Charitable Organisations -

Services by an entity registered under section 12AA or 12AB of the Income-tax Act, 1961 (43 of 1961) by way of various activities will be exempt. Post 31.3.2022 incase where such a charitable organization does not get itself registered u/s 12AB of Income Tax Act, it will not be eligible for this 12% GST Rate benefit also.

This is vide amendment to item Sl 1,9D, 13, 74A, 80 of N No 12/2017 – Central Tax (R) vide N No 7/2021 – Central Tax (R)

2A. Sports -

Exemption provided for Services provided by and to Asian Football Confederation (AFC) and it3s subsidiaries directly or indirectly related to any of the events under AFC Women's Asia Cup 2022 to be hosted in India. Provided that Director (Sports), Ministry of Youth  Affairs and Sports certifies that the services are directly or indirectly related to any of the events under AFC Women's Asia Cup 2022.

This is vide amendment to item Sl 9AB of N No 12/2017 – Central Tax (R) vide N No 7/2021 – Central Tax (R)

2A. Sports -

Services by way of right to admission to the events organised under AFC Women's Asia Cup 2022 shall be exempt

This is vide amendment to item Sl 82B of N No 12/2017 – Central Tax (R) vide N No 7/2021 – Central Tax (R)

3. Transportation for Export -

Services by way of transportation of goods by an aircraft or vessel from customs station of clearance in India to a place outside India shall be exempt till 30th Sept 2022

This is vide amendment to item Sl 19A & 19B of N No 12/2017 – Central Tax (R) vide N No 7/2021 – Central Tax (R)

4. Railways -

Services of leasing of assets (rolling stock assets including wagons, coaches, locos) by the Indian Railways Finance Corporation to Indian Railways shall now be taxable from 1.10.2021

This is vide amendment to item Sl 43 of N No 12/2017 – Central Tax (R) vide N No 7/2021 – Central Tax (R)

5. Transportation -

Services by way of granting National Permit to a goods carriage to operate through-out India / contiguous States shall be exempt. However this exemption shall be applicable from 1.10.2021

This is vide amendment to item Sl 61A of N No 12/2017 – Central Tax (R) vide N No 7/2021 – Central Tax (R)

6. Training & Development -

Services provided to the Central Government, State Government, Union territory administration under any training programme for which 75% or more of the total expenditure is borne by the Central Government, State Government, Union territory administration shall be exempt. Hence part of training expenses may also be borne by private entities for the service to be exempt.

This is vide amendment to item Sl 72 of N No 12/2017 – Central Tax (R) vide N No 7/2021 – Central Tax (R)

Notification No. 8/2021 & 9/2021 - Central Tax (Rate)

1. Agriculture -

Tamarind seeds meant for any use other than sowing shall be taxable at 5% and not be exempt. Only for use of sowing shall be exempt

Further all Seeds, fruit and spores, of a kind used for sowing shall be exempt

This is vide amendment to item Sl 71 od Sch I of N No 1/2017 – Central Tax (R) vide N No 8/2021 – Central Tax (R); &

Item Sl 86 of N No 2/2017 – Central Tax (R) vide N No 9/2021 – Central Tax (R)

2A. Metals

All ores and concentrates [other than slag, dross (other than granulated slag), scalings and other waste from the manufacture of iron or steel; slag, ash and residues (other than from the manufacture of iron or steel) containing metals, arsenic or their compounds; other slag and ash, including seaweed ash (kelp); ash and residues from the incineration of municipal waste]; - All these items will not be taxed at 5%

This is vide amendment to item Sl 138 of Sch I of N No 1/2017 – Central Tax (R) vide N No 8/2021 – Central Tax (R)

Notification No. 8/2021 - Central Tax (Rate)

2B. Metals -

Iron ores and concentrates, including roasted iron pyrites; Manganese ores and concentrates, including ferruginous manganese ores and concentrates with a manganese content of 20% or more, calculated on the dry weight; Copper ores and concentrates; Nickel ores and concentrates; Cobalt ores and concentrates; Aluminium ores and concentrates; Lead ores and concentrates; Zinc ores and concentrates; Tin ores and concentrates; Chromium ores and concentrates; - All these items to be taxed at 18% and not 5%

This is vide amendment to item Sl 138 to 148 of Sch I and Sl 26C to 26L of Sch III of N No 1/2017 – Central Tax (R) vide N No 8/2021 – Central Tax (R)

3. Oil

Bio-diesel supplied to Oil Marketing Companies for blending with High Speed Diesel – It will be taxed at 5% and other Bio-Diesel will be supplied at 12%

This is vide amendment to item Sl 186A of Sch I & 80A of Sch III of N No 1/2017 – Central Tax (R) vide N No 8/2021 – Central Tax (R)

4. Plastics -

Waste, parings or scrap, of plastics – These will not be taxed at 5% but 18%

This is vide amendment to item Sl 187A of Sch I and Sl 101A of Sch III of N No 1/2017 – Central Tax (R) vide N No 8/2021 – Central Tax (R)

5. Clean Energy -

Following renewable energy devices & parts for their manufacture shall be taxed at 12% and not 5% -

(a) Bio-gas plant

(b) Solar power based devices

(c) Solar power generating system

(d) Wind mills, Wind Operated Electricity Generator (WOEG)

(e) Waste toenergyplants/devices

(f) Solarlantern/solarlamp

(g) Ocean waves/tidal waves energy devices/plants

5[(h) Photo voltaic cells, whether or not assembled in modules or made up into panels]

132[Explanation: If the goods specified in this entry are supplied, by a supplier, along with supplies of other goods and services, one of which being a taxable service specified in the entry at S. No. 38 of the Table mentioned in the notification No. 11/2017-Central Tax (Rate), dated 28th June, 2017 [G.S.R. 690(E)], the value of supply of goods for the purposes of this entry shall be deemed as seventy per cent. of the gross consideration charged for all such supplies, and the remaining thirty per cent. of the gross consideration charged shall be deemed as value of the said taxable service.

This is vide amendment to item Sl 234 of Sch I read with Sl 201A of Sch II of N No 1/2017 – Central Tax (R) vide N No 8/2021 – Central Tax (R)

As per the earlier amendment, incase of composite supply of these goods (example Solar Modules along with service), the GST rate would be –

30% of 18% (For services) + 70% of 5% (for goods) = 5.4% + 3.5% = 8.9%

After 1.10.2021, this rate would be –

30% of 18% (For services) + 70% of 12% (for goods) = 5.4% + 8.4% = 13.8%

6. Automobiles -

Retro fitment kits for vehicles used by the disabled“ – This will be taxed at 5%

This is vide amendment to item Sl (B)(3) of List 3 of Sch I of N No 1/2017 – Central Tax (R) vide N No 8/2021 – Central Tax (R)

7. Packaging -

Cartons, boxes and cases of corrugated paper or paper board – Will be taxed at 18% and not 12%

This is vide amendment to item Sl 122 of Sch II & 153A of Sch III of of N No 1/2017 – Central Tax (R) vide N No 8/2021 – Central Tax (R)

8. Postage

Plans and drawings for architectural, engineering, industrial, commercial, topographical or similar purposes, being originals drawn by hand; hand-written texts; photographic reproductions on sensitised paper and carbon copies of the foregoing; Unused postage, revenue or similar stamps of current or new issue in the country in which they have, or will have, a recognised face value; stamp-impressed paper; banknotes; cheque forms; stock, share or bond certificates and similar documents of title 29[other than Duty Credit Scrips; Transfers (decalcomanias); Printed or illustrated postcards; printed cards bearing personal greetings, messages or announcements, whether or not illustrated, with or without envelopes or trimmings; Calendars of any kind, printed, including calendar blocks; Other printed matter, including printed pictures and photographs; such as Trade advertising material, Commercial catalogues and the like, printed Posters, Commercial catalogues, Printed inlay cards, Pictures, designs and photographs, Plan and drawings for architectural engineering, industrial, commercial, topographical or similar purposes reproduced with the aid of computer or any other devices – It will not be taxed at 12% but at 18%

This is vide amendment to item Sl 127 to 132 of Sch II and 157A to 157F of Sch III of N No 1/2017 – Central Tax (R) vide N No 8/2021 – Central Tax (R)

9. Rail -

Rail locomotives powered from an external source of electricity or by electric accumulators; Other rail locomotives; locomotive tenders; such as Diesel-electric locomotives, Steam locomotives and tenders thereof; Self-propelled railway or tramway coaches, vans and trucks, other than those of heading 8604; Railway or tramway maintenance or service vehicles, whether or not self-propelled (for example, workshops, cranes, ballast tampers, track liners, testing coaches and track inspection vehicles); Railway or tramway passenger coaches, not self-propelled; luggage vans, post office coaches and other special purpose railway or tramway coaches, not self-propelled (excluding those of heading 8604); Railway or tramway goods vans and wagons, not self-propelled; Parts of railway or tramway locomotives or rolling-stock; such as Bogies, bissel-bogies, axles and wheels, and parts thereof; Railway or tramway track fixtures and fittings; mechanical (including electro-mechanical) signalling, safety or traffic control equipment for railways, tramways, roads, inland waterways, parking facilities, port installations or airfields; parts of the foregoing – These will not be taxed at 12% but at 18%

This is vide amendment to item Sl 205A to 205H of Sch II and 398A to 398H of Sch III of N No 1/2017 – Central Tax (R) vide N No 8/2021 – Central Tax (R)

10. Printing & Stationery -

Ball point pens; felt tipped and other porous-tipped pens and markers; fountain pens; stylograph pens and other pens; duplicating stylos; pen holders, pencil holders and similar holders; parts (including caps and clips) of the foregoing articles, other than those of heading 9609 – These will not be taxed at 12% but at 18%

This is vide amendment to item Sl 232 of Sch II and 447 of Sch III of N No 1/2017 – Central Tax (R) vide N No 8/2021 – Central Tax (R)

11. Alcohol & Beverage -

Carbonated Beverages of Fruit Drink or Carbonated Beverages with Fruit Juice – these will be taxed at 28% plus Compensation Cess of 12%

This is vide amendment to item Sl 12B of Sch IV of N No 1/2017 – Central Tax (R) vide N No 8/2021 – Central Tax (R) read with item Sl 4B of  No. 1/2017-Compensation Cess (Rate) read with Notification No. 1/2021 - Compensation Cess (Rate)

Notification No. 10/2021 - Central Tax (Rate) – Reverse Charge for Goods -

Any supply of the following from an unregistered person to a registered person shall be under reverse charge –

Following essential oils other than those of citrus fruit namely: -

(a) Of peppermint (Mentha piperita);

(b) Of other mints : Spearmint oil (ex-mentha spicata), Water mint-oil (ex-mentha aquatic), Horsemint oil (ex-mentha sylvestries), Bergament oil (ex-mentha citrate).

This is vide amendment to item Sl 3A of N No 4/2017 – Central Tax (R) vide N No 10/2021 – Central Tax (R)
 

Notification No. 11/2021 - Central Tax (Rate)

Supply in Schemes for Poor -

Fortified Rice Kernel (Premix) supply for ICDS or similar scheme duly approved by the Central Government or any State Government – Such intra state supplies shall be taxed at 5% GST subject to the following –

When the supplier of such goods produces a certificate from an officer not below the rank of the Deputy Secretary to the Government of India or the Deputy Secretary to the State Government or the Deputy Secretary in the Union Territory concerned to the effect that such goods have been distributed free to the economically weaker sections of the society under a programme duly approved by the Central Government or the State Government concerned, within a period of five months from the date of supply of such goods or within such further period as the jurisdictional commissioner of the Central tax or jurisdictional commissioner of the State tax, or jurisdictional officer of the Union Territory Tax as the case maybe, may allow in this regard

This is vide amendment to N No. 39/2017 - Central Tax (Rate)  vide N No 11/2021 – Central Tax (R)

Notification No. 12/2021 - Central Tax (Rate)

Pharma

The GST Rate of following medicines have been specified in the table below –

Sl. No.	Chapter, Heading, Sub-heading or Tariff item	Description of Goods	Rate
(1)	(2)	(3)	(4)
1	30	Tocilizumab	Nil
2	30	Amphotericin B	Nil
3	30	Remdesivir	2.5%
4	30	Heparin (anti-coagulant)	2.5%
5	30	Itolizumab	2.5%
6	30	Posaconazole	2.5%
7	30	Infliximab	2.5%
8	30	Bamlanivimab & Etesevimab	2.5%
9	30	Casirivimab & Imdevimab	2.5%
10	30	2-Deoxy-D-Glucose	2.5%
11	30	Favipiravir	2.5%