Rate of GST on Works Contract Services w.e.f. 01 Jan 2022
W.e.f. 01st Jan 2022 the rate of GST on works contract services for specific contract provided to government authority and government entities will be changed.
Tax Rate On or Before 31.12.2021
1. For Works Mentioned In Item(iii) And (vi) GST Rate Was 12% For Providing Services To Central Government/State Government/Union Territory/Local Authority/ Governmental Authority/ Govt Entity And 18% For Providing Services To Others.
2. For Works Mentioned In Item (iv) ,(v) And (viii) GST Rate Was 12% For Providing Services To Any Body.
3. For Works Mentioned In Item (vii) GST Rate Was 5% For Providing Services To Central Government/State Government/Local Authority/ Governmental Authority/ Govt Entity And 18% For Providing Services To Other.
The same is notified by the government vide notification no 11/2017, 20/2017, 24/2017 and 31/2017. The same are also enclosed in the form of Annexure “A”.
Change Of Tax Rate On or After 01.01.2022
1. For The Works Mentioned In Item (iii) And (vi) GST Rate Has Increased From 12% To 18% For Providing Services To Governmental Authority/Govt Entity.
2. For The Works Mentioned In Item (vii) GST Rate Has Increased From 5% To 18% For Providing Services To Governmental Authority/Govt Entity .
The same is notified by the government vide notification no 15/2021and 22/2021. The same are also enclosed in the form of Annexure “B”.
Meaning of Government Authority & Government Entity:-
A. Government Authority :-
As per Para2(zf) of the Notification No. 12/2017-CT(Rate), dated. 28.06.2017 Ammended By Notification No 32/2017-CT(Rate), dated. 13.10.2017.
(zf) “Governmental Authority” has the same meaning as assigned to it in the Explanation to clause (16) of section 2 of the Integrated Goods and Services Tax Act, 2017 (13 of 2017);
As Per Explanation in Section 16(2) of the Integrated Goods and Services Tax Act, 2017 (13 of 2017);
Explanation.––For the purposes of this clause, the expression ―governmental authority means an authority or a board or any other body,––
(i) set up by an Act of Parliament or a State Legislature; or
(ii) Established by any Government, with 90 per cent. or more participation by way of equity or control, to carry out any function entrusted to a Panchayat under article 243G or to a municipality under article 243W of the Constitution
B. Government Entity :-
As per Para2(zfa) of the Notification NO. 12/2017-CT(Rate) and No 09/2017-IT(Rate)both dated 28.06.2017 inserted w.e.f. 13.10.2017 dated. 28.06.2017.
(zfa) “Government Entity” means an authority or a board or any other body including a society, trust, Corporation,
(i) Set up by an Act of Parliament or State Legislature; or
(ii) Established by any Government, with 90 per cent. or more participation by way of equity or control, to carry out a function entrusted by the Central Government, State Government, Union Territory or a local authority.
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