In a concept note prepared by the National Academy of Customs, Indirect Taxes & Narcotics, the Central Board of Excise and Customs (CBEC) has said that many of the activities of charitable institutions and religious trusts are subject to the Goods and Services Tax (GST).
As per the present law, services by an entity registered under Section 12AA of Income-Tax Act, 1961 by way of charitable activities” is exempt from whole of the GST subject to two conditions. Firstly, Entities must be registered under Section 12AA of the Income Tax Act, and secondly, Such services or activities by the entity are by way of charitable activities.
For this activities, the term ‘charitable activities’ means public health, advancement of religion, spirituality or yoga, advancement of educational programmes or skill development, preservation of environment including watershed, forests and wildlife etc.
Services provided by charitable and religious trust which are not considered as charitable activities come under the GST net. The indicative list of such services could be renting of premises by such entities, grant of sponsorship and advertising rights during conduct of events/functions etc.
a limited exemption to renting of only religious precincts or a religious place meant for general public by the entity registered under Section 12AA of the Income Tax Act subject to the provisions of the Notification No. 12/2017- Central Tax (Rate) dated 28th June, 2017.
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