GST Updates: Amendments in Exemptions and Rates Announced

The Ministry of Finance (Department of Revenue) (“Ministry”) recently on July 12, 2024, published 2 (two) notifications, vide notification no. 02/2024-Central Tax (Rate) and notification no. 04/2024- Central Tax (Rate) (“Notifications”), have notified exemption of several services from levy of Goods and Service Tax (“GST”) and the revised GST slab rate on certain supplies, pursuant to the recommendations of the 53^rd GST council. The Notifications have come into force with effect from July 15, 2024.

Services Exempted from Levy of GST

Services related to the Ministry of Railways:

           i.       Services provided by the Ministry of Railways to individuals, by way of –

a.   sale of platform tickets;

b.   facility of retiring rooms/waiting rooms;

c.   cloak room services; and

d.   battery operated car services.

The exemption is regularized retrospectively for the period from October 20, 2023 to July 14, 2024 on ‘as is where is’ basis.

          ii.     Services provided by one zone/division to another zone(s)/division(s) under the Ministry of Railways. The exemption is similarly regularized retrospectively for the period from October 20, 2023 to July 14, 2024.

        iii.       Services provided by Special Purpose Vehicles (“SPVs”) to Ministry of Railways by way of allowing the Ministry of Railways to use the infrastructure built and owned by them during the concession period against consideration and services of maintenance supplied by Ministry of Railways to SPVs in relation to the said infrastructure built and owned by the SPVs during the concession period against consideration. This exemption is also regularized on an ‘as is where is’ basis for the period from July 01, 2017 to July 14, 2024.

Accommodation Services: Supply of accommodation services having value of supply less than or equal to INR 20,000/- (Indian Rupees Twenty Thousand Only) per person per month, provided that the accommodation service is supplied for a minimum continuous period of 90 (ninety) days.

However, it has been clarified by the Ministry that the accommodation services for students in student residences and the accommodation services provided by hostels, camps, paying guest accommodations and the like, are covered under the ambit of GST and are not exempted under Serial No. 12 of notification no.12/2017-Central Tax (Rate), which provides an exemption to ‘services by way of renting of residential dwelling for use as residence, except where the residential dwelling is rented to a registered person’.

Revised GST Slab Rates:

The Ministry has made the moved the following commodities in the 12% (twelve percent) GST slab rate, which were earlier set at 18% (eighteen percent) slab rate:

1.     Cartons, boxes, and cases made of both corrugated and non-corrugated paper or paper-board;

2.     All milk cans, regardless of their material (iron, steel, or aluminium);

3.     Solar cookers, whether single or dual energy source; and

4.     Parts of brooders.

The above-mentioned Notifications can be accessed here:

1.       https://taxinformation.cbic.gov.in/view-pdf/1010106/ENG/Notifications

2.       https://taxinformation.cbic.gov.in/