Dr. Sanjiv Agarwal

As per Section 2(96) of the Model GST Law, ‘taxable person’ has been defined to have a meaning as assigned to it in section 9 of the model law.

According to section 9, taxable person means a person who carries on any business at any place in any state or India or and who is registered or required to be registered for the purpose of GST law as per Schedule –III to the Act.

Taxable person would therefore, cover both – one who are registered as taxable person under the Act and two, persons who are not so registered but required to be so registered. Thus, even unregistered person would be called a taxable person liable as such under the Act.

Following points are worth noting in relation to taxable person –

a) Taxable person in a person who carries on any business.

b) Taxable person may carry such business at any place in India or any state in case of SGST

c) Taxable person should be registered or required to be registered under Schedule-III of the Act.

d) An agriculturist [defined in section 2(8)] is not considered as a taxable person

e) A person should be considered as a taxable person only if his aggregate turnover exceeds Rs. 10 lakh in a financial year [Rs. 5 lakh in case of North East States including Sikkim)

f) Central Government, State Government or local authority shall be considered as taxable person in respect of activities / transactions (other than as specified in Schedule-IV) where they are engaged as public authority

Schedule-IV of the Act contains list of activities or transactions in respect of which the Central Government, a State Government or any local authority shall not be regarded as a taxable person.

Examples of such services are services in relation to statutory functions (pass port, visa, driving license, birth or death certificate; functions under article 243W or 243G of Constitution; health care, education, tax, right to use natural resources, merchant overtime charges, registration under any law; services in relation to diplomatic / consular / emigration / currency / import or export / public order etc.

Following persons shall not be considered as taxable persons –

a) person providing services as an employee to his employer in terms of employment or under any legal tie creating employee –employer relationship.

b) person in business of exclusively supplying goods or services not liable to tax

c) person liable to pay tax under reverse charge [section 7(3)] receiving services of value not exceeding a specified limit in a year for personal use (not for use in course of or furtherance of his business).

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