The Advance Ruling Authority (AAR), Kerala has held that the activity of printing of images from digital media would attract 18% Goods and Services Tax (GST).
M/s Colortone Process Pvt. Ltd. is engaged in the activity of high-quality digital printing services. The customers provided the content that is to be printed and the applicant is executing the job work of printing. It was contended that the applicant neither owns nor generates any content and the cost of printing depends upon the quality of paper selected for the printing. As printing technology has developed, the. the applicant has adopted a state of art digital technology driven by the use of computers so that the high quality of the printout can be generated like photographic prints.
Before the AAR, the applicant sought an advance ruling regarding their tax liability under the GST Act.
The AAR observed that the technological difference between ordinary print with digital print is in the way the images get transferred onto the paper.
“The quality of the print 1 output depends upon the quality of paper used; the best quality and best print performance get from glossy photo paper. The printing of pictures i images on ordinary paper and glossy coated/ paper is entirely different. The quality of printing is high in glossy coated paper. Coated paper 1 is treated to give it a glossy or matte finish. A product on coated paper (whether it’s matte or glossy) will end up looking more expensive. As per the explanatory notes to the scheme of 1 classification of services as discussed above the printing of pictures I images on glossy coated/paper/photo paper will not come under the Service Classification Code 998912, as it is li specifically excluded from the classification and included in the Service Classification Code 998386. Therefore, the work of printing of images from digital media executed by the applicant comes within the ambit of Service Classification Code 998386 as the colour printing of images from digital media is specifically under this classification. In view of the observations stated above, the following rulings are issued: Will the service of “printing work” carried out by the applicant come within the purview of service of “printing of pictures” as covered under Cir.No.84/0312019-GST dated 01,01.2019,” the AAR said.
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