The Central Board of Indirect Taxes and Customs ( CBIC ), has clarified that the Priority Sector Lending Certificates would attract GST under forward charge from the period 1.7.2017 to 27.05.2018.
The CBIC issued the circular in the light of representations received from the stakeholders regarding the mechanism for discharge of tax liability on trading of Priority Sector Lending Certificate (PSLC) for the period 1.7.2017 to 27.5.2018 and the GST rate applicable on trading of PSLCs.
“The representations have been examined. With the approval of the GST Implementation Committee of the GST Council, it is clarified that GST on PSLCs for the period 1.7.2017 to 27.05.2018 will be paid by the seller bank on forward charge basis and GST rate of 12% will be applicable on the supply,” the Board said.
Priority Sector Lending Certificates is a tool for promoting comparative advantages among banks while they meet their priority sector lending obligations in India.To Read the full text of the Circular CLICK HERE