The Kerala flood cess rules 2019 shall be implemented from 01st July 2019 (Date Changed from 01st June 2019) onwards for a period of two years i.e till June 2021. As per the aforesaid Rules, Kerala flood cess (KFC) shall be imposed at the rate of 1% and/or 0.25% on the following local outward supplies (Intrastate outward supplies) made to B2C customers/Ultimate customers not having GST registration /unregistered persons, by the persons registered under the Kerala GST Act except for composition dealers of goods.
| Local outward supply | KFC Rate |
| (1) All goods attracting GST @ 3% | 0.25% |
| (2) All goods attracting GST @ 12%, 18% and 28% | 1% |
| (3) All services including Composition dealers of services like hotels, restaurants etc. | 1% |
Various Compliances under The Kerala flood cess rules 2019 are as follows:
1, KFC shall be collected separately on the taxable value of supplies (Taxable value of supply shall not include Discount, GST and GST compensation cess) made from 1st June 2019 onwards.
2, The CGST and KGST shall be levied and collected on the sum of taxable value and KFC. That means, section 15(2)(a) of The GST Act’s mandates to include all duties, taxes and cesses levied under any law other than GST ACT’s and GST Compensation ACT in the Taxable value. So, KGST and CGST shall be levied and collected on the taxable value inclusive of Kerala Flood Cess (KFC). No amendments have been made in the GST ACT’s so far to nullify the double taxation effect mentioned above. However, the government of Kerala has considered the double taxation situation arising due to the conflicting provisions of the GST Acts. Therefore, a valid notification is much awaiting from the department to eliminate all these issues.
3,KFC shall be shown separately in the invoice in addition to KGST and CGST.
4, The KFC so collected shall be paid to the Kerala Government on a monthly basis by filing separate E-Form KFC-A through the official portal ‘’ www.keralataxes.gov.in” on or before the due date of filing of GSTR-3B.
5, One-time user ID and password shall be generated from the portal www.keralataxes.gov.in for paying the above cess and filing E-Form KFC-A.
6, KFC once paid shall not be refunded.
Kerala Flood Cess (KFC) is not applicable to the following type of outward supplies:
1, Supplies made by composition dealers of goods.
2, Supplies between dealers registered under GST, So there would not arise any question on credit of KFC paid on purchases.
3, Outward supplies of goods attracting GST @ 5 %.
4, Outward supplies of goods attracting GST @ 0.25 %.
5, All Interstate outward supplies of Goods, Services and both.
6, All exempted outward supplies.
Disclaimer: All the above statements are for your information. You have to draw a conclusion based on the careful analysis of the relevant provisions of The Kerala Finance Bill 2019 read with The Kerala Flood Cess Rules, 2019.
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How about the credit notes? should we deduct KFC ??
Since the implementation date further extended to 1st July 2019, The date Ist July 2019 shall be substituted for The date 1st June 2019 mentioned in clause 1 under the heading “VARIOUS COMPLIANCES UNDER THE KERALA FLOOD CESS RULES 2019 ARE AS FOLLOWS’’.
Moreover, we can expect that the issue described in clause 2 of the same heading would also resolve within 1st July 2019.