No GST on hostel accommodation at educational institutions, says Arun Jaitley

Putting all the rumours about the newly rolled out Goods and Services Tax (GST ) to rest, Finance Minister Arun Jaitley on Thursday said that services provided by an educational institution to its students, faculty and staff are fully exempt from GST.

No GST on annual subscription/fees charged as lodging/boarding charges by educational institutions from students for hostel, Jaitley tweeted.

No GST on annual subscription/fees charged as lodging/boarding charges by edu institutions from students for hostel;https://t.co/IDhSvov7nL

- Ministry of Finance (@FinMinIndia) July 13, 2017

 

Earlier, there were some reports that 18 per cent GST will be levied on annual subscription/fees charged for lodging in hostels.

There is no change in tax liability relating to education and related services in the GST era, except reduction in tax rate on certain items of education, a government press release said.

 

Services provided by Housing Society Resident Welfare Association (RWA) not to become expensive under GST; pl log on https://t.co/vi99oCYA4z

- Ministry of Finance (@FinMinIndia) July 13, 2017

The Finance Minister also clarified that there is no change made to services provided by the Housing Society (RWA) to its members in the GST regime.

 

It may be mentioned that supply of service by RWA to its own members by way of reimbursement of charges or share of contribution up to an amount of Rs 5,000 per month per member for providing services and goods for the common use of its members in a housing society or a residential complex are exempt from GST, a government pree release said.

Further, if the aggregate turnover of such RWA is upto Rs 20 lakh in a financial year, then such supplies would be exempted from GST even if charges per member are more than Rs 5,000, it added.

However, RWA shall be required to pay GST on monthly contribution charged from its members if the amount is more than Rs 5,000 per member and the annual turnover of RWA is also Rs 20 lakhs or more.

Under GST, the tax burden on RWAs will be lower for the reason that they would now be entitled to ITC in respect of taxes paid by them on capital goods (generators, water pumps, lawn furniture etc.), goods (taps, pipes, other sanitary/hardware fillings etc.) and input services such as repair and maintenance services, it added.