gst impact on education

GST Tax Rates India will Cover Education Sector as Well

GST

The biggest tax reform ever taken GST is soon to get implemented from July 1. So much has already been discussed about the bill and the segments it will be affected. The impact of it can be witnessed on all sectors. After the implementation of the bill some goods will get cheaper while the price of some will become dearer.

The price reflection will not only be seen in apparels, eatables, footwear and other day to day things but also on cost of luxury items and  financial industry. Even the educational sector won’t be spared from the influence of GST. GST Tax Rates India cover the most valuable sector of the economy that is the education.  

gst impact on education

In India, education holds so much importance. Youngsters under the age of 25 years hold much part of the population. Keeping in mind the value of education, the GST council has decided to continue the exemption of education from the service taxes. However, the advantage of exemption is not available on higher educational institutions. The Higher Educational Institutions have to bear the burden of GST.  

Previously, majority of the services provided to the educational institutions were liberated from service taxes. Afterwards, these services were limited to only four categories. The services like catering, housekeeping transportation, admission and examination offered to the institutes of higher studies were taxed. Under the GST rule, this practices has been continued.  

However, all services provided in the field of education will not be liable to Goods and Service Tax. This decision was taken by the GST council on 18 – 19 May. The IGST will be applicable on inter-state supplies only. Moreover, CGST & SGST will be applied on intra-state / union territory supplies. The impact will be seen on commercial coaching and training where at present service tax are charged. Under the new regime GST will replace the service tax and all other indirect taxes charged.

The burden of taxes is levied only on the services provided to the educational institutes while the services offered by the educational institutes are not subject to any taxation.

Educational Services Free from GST

The exclusions which are given in the present time will exist in the new taxation norm also. A clear list mentioning the spared services related to education has been prepared. The list of services not subject to GST Tax Rates is provided below. This includes the following services:

(a) by an educational institution to its students, faculty and staff

(b) to an educational institution, by way of

(i) transportation of students, faculty and staff;

(ii) catering, including any mid-day meals scheme sponsored by the Government

(iii) security or cleaning or house-keeping services performed in such educational institution

(iv) services relating to admission to, or conduct of examination by, such institution

With vast population in India and education being the need of an hour it is expected of an Indian Government to revise the GST policy. For now the schools from primary to higher secondary  can enjoy tax free procurements.

Kunal Jaiswal is a digital marketing Executive and has written many topics in the related field.

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