GOODS AND SERVICES TAX
Queries relating to GST on Services, received from various sectors have been scrutinised and developed into short FAQs.
Ans a) Declared or published tariff is relevant only for determination of the tax rate slab. GST will be payable on the actual amount charged (transaction value).
b) GST rate would be determined according to declared tariff for the room, and GST at the rate so determined would be levied on the entire amount charged from the customer. For example, if the declared tariff is Rs. 7000/- per unit per day but the amount charged from the customer on account of extra bed is Rs. 8000/-, GST shall be charged at 18% on Rs. 8000/-.
c) Tariff declared anywhere, say on the websites through which business is being procured or printed on tariff card or displayed at the reception will be the declared tariff. In case different tariff is declared at different places, highest of such declared tariffs shall be the declared tariff for the purpose of levy of GST.
d) In case different tariff is declared for different seasons or periods of the year, the tariff declared for the season in which the service of accommodation is provided shall apply.
e) Declared tariff at the time of supply of this service would apply.
f) If declared tariff of the accommodation provided by way of upgrade is Rs. 10000/-, but amount charged is Rs. 7000/-, then GST would be levied @ 28% on Rs. 7000/-.
Ans Relevant part of entry 34 of the said CGST notification reads as under:
“Heading 9996 (recreational, cultural and sporting services)-
(iii) Services by way of admission to entertainment events or access to amusement facilities including exhibition of cinematograph films, theme parks, water parks, joy rides, merry-go rounds, go-carting, casinos, race-course, ballet, any sporting event such as Indian Premier League and the like. – 14%
(v) Gambling. -14%”
As is evident from the notification, “entry to casinos” and “gambling” are two different services, and GST is leviable at 28% on both these services (14% CGST and 14% SGST) on the value determined as per section 15 of the CGST Act. Thus, GST @ 28% would apply on entry to casinos as well as on betting/ gambling services being provided by casinos on the transaction value of betting, i.e. the total bet value, in addition to GST levy on any other services being provided by the casinos (such as services by way of supply of food/ drinks etc. at the casinos). Betting, in pre-GST regime, was subjected to Betting Tax on full bet value.
Ans. GST would be leviable on the entire bet value i.e. total efface value of any or all bets paid into the totalisatoror placed with licensed book makers, as the case may be. Illustration: If entire bet value is Rs. 100/-, GST leviable will be Rs. 28/-
Ans. a) Price/declared tariff does not include taxes.
b) Room rent in hospitals is exempt.
c) Any service by way of serving of food or drinks including by a bakery qualifies under Section 10(1) (b) of CGST Act and hence GST rate of composition levy for the same would be 5%.
Ans Notification No. 17/2017-Central Tax (Rate), has been issued making ECOs liable for payment of GST in case of accommodation services provided in hotels, inns, guest houses or other commercial places meant for residential or lodging purposes provided by a person having turnover below Rs. 20 lakh (Rs. 10 lakh in special category states) per annum and thus not required to take registration under Section 22(1) of CGST Act. Such persons, even though they provide services through ECO, are not required to take registration in view of Section 24(ix) of CGSTAct, 2017.
Ans The supply of books shall be treated as supply of goods as long as the supplier owns the books and has the legal rights to sell those books on his own account.
Ans Yes. In case of legal services including representational services provided by an advocate including a senior advocate to a business entity, GST is required to be paid by the recipient of the service under reverse charge mechanism, i.e. the business entity.