APPLICABILITY OF GST LAW ON EDUCATIONAL INSTITUTIONS
By: – Vatsalya Bhardwaj
Goods and Services Tax – GST
Dated:- 23-3-2017
As per the present Service-tax law, all educational institutions are exempt from service-tax. In this regard, reference can be made to Notification on providing for exemption vide which all schools rendering education from pre-school to higher secondary level, are exempt. Further all universities providing qualification recognized by the Government are also exempt. All Government educational institutions including vocational education courses are also exempt. Educational institutions set up under specific Act are also exempt like Indian Institute of Management. In other words, all educational institutions except which are of commercial nature and carrying on coaching activities are exempt. It can be said that considering the importance of education, all educational institutional institutions have been kept out of purview of service-tax.
In the rev
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ducation as a part of an approved vocational education course.”
In view of above definition of governmental authority, exemption has been provided as per proposed law from GST only in respect of education being provided by institutions set up by the Government or where Government is having participation of 90% or more. As a result of aforesaid provision in revised Model GST law, all other educational institutions which are being run by other charitable institutions will become chargeable to GST. As per the proposal, rate of tax under GST which is likely to be applicable in case of educational services would be 18%. As a result of levy of GST on educational services, the cost of education in all private schools, universities, etc. will become costlier at least by 18%.
It can be said that the proposal, as it appears, to levy GST on educational services will not be fair and logical and it will not be in public interest. It is, therefore, desirable that the Government should re-consider
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, whether small or big in case such institutions are not excluded from the scope of applicability of GST law.
Reply By Ganeshan Kalyani as =
Nice article Sir. Education is a basic necessity in today's world. In middest of rising cost, inflation meeting ends became difficult. It is battle for poor to meet their ends. Education is the power which can eliviate the poverty. Thus , this should have been free or atleast free from tax. Getting admission is like buying education. If the leaders want to improve the nation, the primary is to free education. When people develop nation develops, when society develops nation develops , when thought develops nation develops, to develop thoughts education is must. Taxing education is like restricting education to the people who can afford to spend. What can poor do, if education is costly. The government should consider this aspect before final law is finalised. Thanks.
Dated: 23-3-2017
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