18% GST payable on Work Contracts provided by Union Territory or Local Authority: CBIC [Read Notification]

GST - work Contracts - Union territory- local authority - CBIC - Taxscan

The Central Board of Indirect Taxes (CBIC) has notified that 18% GST payable on work Contracts provided by Union territory or local authority w.e.f. January 2022

In exercise of the powers conferred by sub-section (1), sub-section (3) and sub- section (4) of section 9, sub-section (1) of section 11, sub-section (5) of section 15, sub-section (1) of section 16 and section 148 of the Central Goods and Services Tax Act, 2017, the Central Government, on being satisfied that it is necessary in the public interest so to do, on the recommendations of the Council, further amended the notification of the Government of India, in the Ministry of Finance (Department of Revenue) No.11/2017- Central Tax (Rate), dated the 28th June, 2017.

In the said notification, in the TABLE, – (i) against serial number 3, in column (3),in the heading ―Description of Service‖, in items (iii),(vi),(ix) and (x), for the words ―Union territory, a local authority, a Governmental Authority or a Government Entity‖ the words ―Union territory or a local authority‖ shall be substituted; in column (3), in the heading ―Description of Service‖, in item (vii), for the words ―Union territory, local authority, a Governmental Authority or a Government Entity‖ the words ―Union territory or a local authority‖ shall be substituted and in column (5), in the heading ―Condition‖, the entries against items (iii),(vi),(vii),(ix) and (x), shall be omitted.

Further, against serial number 26, in column (3), in the heading ―Description of Service‖, in item (i), in clause (b), after the words, numbers, figures and brackets ―Customs Tariff Act, 1975 (51 of 1975)‖ the words ―except services by way of dyeing or printing of the said textile and textile products‖ shall be inserted.

The serial no. 3 pertains to the construction services and serial number 26 relates to Manufacturing services on physical inputs (goods) owned by others.

This notification shall come into force with effect from the 1st day of January, 2022.

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