GST of Education With Boarder PDF

PRAHLADRAI DALMIA LIONS COLLEGE OF COMMERCE AND ECONOMICS
❖ Chapter 1
Introduction
Taxation means by which governments finance their expenses by imposing charges
on citizens and corporate entities. Governments use taxation to encourage or discourage certain
economic decisions. For example, reduction in taxable personal (or household) income by the
amount paid as interest on home mortgage loans results in greater construction activity, and
generates more jobs. See also taxation principles.
➢ Specified in the income tax ACT 1961

➢ Implementation according to the rules laid down in the income tax rules 1962(“the
rules”)
➢ Administered through the circulars issued by the Central Board Of Direct Tax )
➢ Interpreted by the judgment of the Supreme Court & High Court which settle the legal
disputes between the Government and taxpayers.
TYPES OF TAXATION
DIRECT TAX
Direct Taxes, the name suggests, are taxes that are directly paid to the government by the
taxpayer. It is a tax applied on individuals and organizations directly by the government
e.g. wealth tax, corporation tax, income tax etc.
INDIRECT TAX
Indirect Taxes are applied on the manufacture or sale of goods and services.
IMPACT OF GST ON EDUCATION SECTOR 1

Defination of Good and Service Tax (GST)
Under Article 366 of the constitution, Goods and Services tax (GST) means ant
tax on supply on goods, or services or both except tax on the supply of the
alcoholic liquor for human consumption.
Goods
Goods means every kind of movable property other than money and securities, but includes
actionable claim, growing crops, grass and things attached.
Services
Services means anything other than goods money and securities, but includes activities
related to the use of money or its convention by cash or any other mode.

What is Goods and Service Tax (GST)
The goods and services tax (GST) is a value-added tax levied on most goods and services sold
for domestic consumption. The GST paid by consumers, but it is remitted to the government
by the businesses selling of goods and services. In effect, GST provides revenue for the
government.
How the GST system works
Most countries with a GST have a single unified GST system, which means that a single tax
rate is applied throughout the country. A country with a unified GST platform merges central
taxes (e.g. service tax, excise duty tax, and sales tax) with state-level taxes (e.g. entertainment
tax, entry tax, transfer tax, sin tax, and luxury tax) and collects them as one single tax. These
countries tax virtually everything at a single rate.
INDIA’S ADOPTION OF THE GST
➢ India established a dual GST structure in 2017, which was the biggest reform in the
country's tax structure in decades. The main objective of incorporating the GST is to
eliminate tax on tax or double taxation, which cascades from the manufacturing level
to the consumption level. For eg, a manufacturer that makes books obtains the raw
materials for, say, Rs. 10, which includes a 10% tax. This means that he pays Rs. 1 in
tax for Rs. 9 worth of materials. In the process of manufacturing the notebook, he adds
value to the original materials of Rs. 5, for a total value of Rs. 10 + Rs. 5 = Rs. 15. The
10% tax due on the finished good will be Rs. 1.50. Under a GST system, this additional
tax can be applied against the previous tax he paid to bring his effective tax rate to Rs.
1.50 - Rs. 1.00 = Rs. 0.50.
➢ The wholesaler purchases the book for Rs. 15 and sells it to the retailer at a Rs. 2.50
markup value for Rs. 17.50. The 10% tax on the gross value of the good will be Rs.
1.75, which he can apply against the tax on the real cost price from the manufacturer
i.e. Rs. 15. The wholesaler’s effective tax rate will, thus, be Rs. 1.75 - Rs. 1.50 = Rs.
0.25.

➢ If the retailer’s margin is Rs. 1.50, his effective tax rate will be (10% x Rs. 19) - Rs.
1.75 = Rs. 0.15. Total tax that cascades from manufacturer to retailer will be Rs. 1 + Rs.
0.50 + Rs. 0.25 + Rs. 0.15 = Rs. 1.90.
➢ India has, since launching the GST on July 1, 2017, implemented five different tax
rates.
➢ A 0% tax rate applied to certain foods, books, newspapers, homespun cotton cloth and
hotel services under Rs. 1000.
➢ A rate of 0.25% applied to raw industrial diamonds.
➢ A 5% tax rate applied to apparel below Rs. 1000, packaged food items, footwear under
Rs. 500, etc.
➢ A 12% tax rate applied to apparel over Rs. 1000, frozen meats, cutlery, sugar, bio-
diesel, etc.
➢ An 18% tax rate applied to certain luxury items including makeup, pastries, swimming
pools, footwear costing more than Rs. 500, etc.
➢ The final bracket, taxing goods at 28%, applied to 50 luxury products and those deemed
“sinful,” including sunscreen, ceramic tiles, bidis (Indian cigarettes), cars, motorcycles,
etc.
➢ The previous system with no GST implies that tax is paid on the value of goods and
margin at every stage of the production process. This would translate to a higher amount
of total taxes paid, which is carried down to the end consumer in the form of higher
costs for goods and services. The implementation of the GST system in India is,
therefore, a measure that is used to reduce inflation in the long run, as prices for goods
will be lower.

TYPES OF GST
➢ CGST
➢ SGST/UTGST
➢ IGST
CGST (CENTRAL GOODS AND SERVICE TAX)
As per the Central Goods & Services Tax Act 2016, CGST is the centralized part of GST that
subsumes the present central taxations and levies- Central Sales Tax, Central Excise Duty,
Services Tax, Excise Duty under Medical & Toiletries Preparation Act, Additional Excise
Duties Countervailing Duty (CVD), Additional Custom Duty and other centralized taxations.
CGST is applicable on the supply of goods and services of standard services and commodities
which can be amended periodically by a specialized body under the central government. The
revenue collected under CGST belongs to the central government. The input tax is given to the
state governments which they can utilize only against the payment of CGST.
SGST (STATE GOODS AND SERVICE TAX)
SGST is an important part of GST. It stands for State Goods & Services Tax as per the 2016
GST bill. Various taxations and levies under the state authority are subsumed by SGST as one
uniform taxation. It includes the amalgamation of State Sales Tax, Luxury Tax, Entertainment
Tax, Levies on Lottery, Entry Tax, Octroi and other taxations related to the movement of
commodities and services under state authority through one uniform taxation- SGST.

UTGST (UNION TERRITORY GOODS AND SERVICE TAX)
As we have already learned about CGST and SGST which are intra-state taxations and IGST
which is inter-state, the union territories in India are accounted under a specialized taxation
called Union Territory Goods and Services Tax as per the GST regime 2016. It will subsume
the various taxations, levies and duties with one uniform taxation in Union Territories as well.
Delhi (India’s Capital Territory), Chandigarh, Dadra & Nagar Haveli, Andaman & Nicobar
Islands, Daman & Diu, Lakshadweep and Puducherry are the prominent union territories in
India. UTGST will account for all the taxations under these union territories in India. The
parliament is looking forward to implement a separate act to impose and supervise GST in
Union Territories under the name of UTGST act. The bill will be presented in respective union
territories for further changes in the implementation of GST.
IGST (INTEGRATED GOODS AND SERVICE TAX)
GST focuses on the concept of one tax, one nation. IGST stands for Integrated Goods and
Services Tax which is charged on the supply of commodities and services from one state to
another state. For example, if the supply of goods and services occurs between Gujarat and
Maharashtra, IGST will be applicable.
Under Article 269A of the Indian Constitution, the inter-state trade and commerce activities
that involve the movement of commodities and services shall be levied with an integrated tax
(IGST) under the GST regime. The Government of India will collect the revenue under IGST.
Further changes can be made by the Goods and Services Tax Council of India.

GST RATES ON GOODS
The government has proposed a 4-tier tax structure for all goods and services under the slabs-
5%, 12%, 18% and 28%. After the recent revision of GST rates, these are the commodities that
fall under the four tax slabs along with those that do not attract any tax. Please note that only
those commodities are included in this list whose rates have been revised in various council
meetings.
NO TAX
Apart from other items that enjoy zero GST tax rate, these are the commodities added to the
list after 11th June rate revision –
➢ Hulled cereal grains like barley, wheat, oat, rye, etc.

➢ Bones and horn-cores unworked and waste of these products.
➢ Palmyra jaggery
➢ All types of salt
➢ Dicalcium Phosphate (DCP) of animal feed grade conforming to IS specification No.
5470 :2002
➢ Kajal [other than kajal pencil sticks]
➢ Picture books, colouring books or drawing books for children
➢ Human hair – dressed, thinned, bleached or otherwise worked
➢ Sanitary Napkins
➢ Unit container-packed frozen branded vegetables (uncooked/steamed)
➢ Vegetables preserved using various techniques including brine and other preservatives
that are unsuitable for immediate human consumption.
➢ Music Books/manuscripts
5% TAX SLAB
➢ Given below are the items that have been added to the 5% GST tax rate slab along with
the other existing items-
➢ Cashew nuts/cashew nuts in shell
➢ Ice and snow
➢ Bio gas
➢ Insulin
➢ Aggarbatti
➢ Kites
➢ Coir mats, matting and floor covering
➢ Pawan Chakki that is Wind-based Atta Chakki
➢ Postage or revenue stamps, stamp-postmarks, first-day covers, etc.
➢ Numismatic coins
➢ Braille paper, braille typewriters, braille watches, hearing aids and other appliances to
compensate for a defect or disability
➢ Fly-ash blocks
➢ Walking sticks
➢ Natural cork
➢ Marble rubble
➢ Accessories/parts for carriages designed for differently-abled individuals
12% TAX SLAB
➢ After the GST council meeting on 11th June, the following items were added to the
12% GST rates category-
➢ Preparations of vegetables, fruits, nuts or other parts of plants, including pickle,
murabba, chutney, jam, jelly
➢ Ketchups, sauces and mustard sauce but excluding curry paste, mayonnaise and salad
dressings, mixed condiments and mixed dressings
➢ Bari made of pulses including mungodi
➢ Menthol and menthol crystals, peppermint, fractionated/de-terpenated mentha oil,
dementholised oil, Mentha piperita oil and spearmint oil
➢ All diagnostic kits and reagents
➢ Plastic beads
➢ Exercise books and note books
➢ Glasses for corrective spectacles and flint buttons
➢ Spoons, forks, ladles, skimmers, cake servers, fish knives, tongs
➢ Fixed Speed Diesel Engines
➢ Two-way radio (Walkie talkie) used by defence, police and paramilitary forces etc.
➢ Intraocular lens

➢ Corrective spectacles
➢ Playing cards, chess board, carom board and other board games, like ludo, etc.
➢ Debagged/roughly squared cork
➢ Items manufactured from natural cork
➢ Agglomerated cork
➢
18% TAX SLAB
➢ The items mentioned below have been added to the 18% GST tax rate slab among the
other existing items-
➢ Kajal pencil sticks
➢ Dental wax
➢ Plastic Tarpaulin
➢ School satchels and bags other than of leather or composition leather; toilet cases, Hand
bags and shopping bags of artificial plastic material, cotton or jute; Handbags of other
materials excluding wicker work or basket work
➢ Headgear and parts thereof
➢ Precast Concrete Pipes
➢ Salt Glazed Stone Ware Pipes
➢ Aluminium foil
➢ All goods, including hooks and eyes
➢ Rear Tractor tyres and rear tractor tyre tubes
➢ Rear Tractor wheel rim, tractor centre housing, tractor housing transmission, tractor
support front axle
➢ Weighing Machinery other than electric or electronic weighing machinery
➢ Printers other than multifunction printers
➢ Ball bearing, Roller Bearings, Parts & related accessories
➢ Transformers Industrial Electronics
➢ Electrical Transformer
➢ Static Converters (UPS)
➢ CCTV including CCTV with video recorders
➢ Set top Box for TV
➢ Computer monitors not exceeding 17 inches

➢ Electrical Filaments or discharge lamps

➢ Winding Wires, Coaxial cables and Optical Fiber
➢ Perforating or stapling machines (staplers), pencil sharpening machines
➢ Baby carriages
➢ Instruments for measuring length, for use in the hand (for example, measuring rods and
tapes, micrometers, callipers)
➢ Bamboo furniture
➢ Swimming pools and paddling pools
➢ Televisions/Monitors (upto 32 inches)
➢ Power banks powered by Lithium-ion batteries
➢ Sports goods, games consoles and related items with HS code 9504
➢ All items with HS code 8483 including gear boxes, transmission cranks and pulleys
➢ Used or retreaded pneumatic rubber tires
28% TAX SLAB
➢ The council meeting was held to ‘reduce’ the tax rates on certain items based on
customer preferences. Hence, no additional items were added to the highest GST rates
slab of 28%.

GST RATES ON SERVICES

Nil GST
➢ Chargeable services offered on Basic Savings Bank Deposit (BSBD) account opened
under the PMJDY (Pradhan Mantri Jan Dhan Yojana)
5%GST slab
➢ Railways-Transportation of goods, passengers

➢ Goods transported in a vessel from outside India
➢ Renting a motor cab without fuel cost
➢ Transport services in AC contract/stage or radio taxi
➢ Transport by air (scheduled)/air travel for purpose of pilgrimage via chartered/non-
scheduled flights
➢ Tour operator services
➢ Leasing of aircrafts
➢ Print media ad space
➢ Working for printing of newspapers
12% TAX SLAB
➢ Rail transportation of goods in containers from a third party other than Indian
Railways
➢ Air travel excluding economy
➢ Food /drinks at restaurants without AC/heating or liquor license
➢ Renting of accommodation for more than Rs.1000 and less than Rs.2500 per day
➢ Chit fund services by foremen
➢ Construction of building for the purpose of sale

18% TAX SLAB
➢ Food/drinks at restaurants with liquor license

➢ Food /drinks at restaurants with AC/heating
➢ Outdoor catering
➢ Renting for accommodation for more than Rs.2500 but less than Rs.5000 per day
➢ Supply of food, shamiyana, and party arrangement
➢ Circus, Indian classical, folk, theatre, drama
➢ Supply of works contract
➢ Movie Tickets over Rs. 100
28% TAX SLAB
➢ Entertainment events-amusement facility, water parks, theme parks, joy rides, merry-
go-round, race course, go-carting, casinos, ballet, sporting events like IPL
➢ Race club services
➢ Gambling
➢ Food/drinks at AC 5-star hotels
➢ Accommodation in 5-star hotels or above

❖ Chapter 2
RESEARCH METHODOLOGY
IMPACT OF GST ON EDUCATION SECTOR
“Education” is not defined in the CGST Act but as per Apex Court decision in “Loka Shikshana
Trust v/s CIT”, education is the process of training and developing knowledge, skill, and
character of students by normal schooling.
Education is one of the major sectors of any economy. The education of country’s youth
decides how the economy of that country will flourish. Education promotes understanding,
vision, creativity and productivity of people which helps in the advancement of a country. In
India, Education is provided with both by the public as well as private sector.
Indian government’s foremost priority is to provide low-cost education to one and all. That’s
why education sector enjoys lots of tax exemption as they are not taxed or comes in the
negative list.
After implementation of GST, the similar situation continued with the tax exemptions for the
sector being retained and the most important thing is that educational services and services
related to the education/higher education provided to the students are covered under the GST
exempt list.
According to the GST proposed law, services provided by educational institutions have been
kept outside from the Goods and Services Tax (GST). Here educational institutions mean any
of the institutions providing services by way of:-
➢ Pre-school education and education up to higher secondary school or equivalent or

➢ Education as a part of a curriculum for obtaining a qualification recognized by any law
for the time being in force; or

IMPACT OF GST ON EDUCATION SECTOR
"Knowledge is an eye for the blind, ears for the deaf, strength for the weak and all in all it is a
boon for the mankind”. It is argued that a person who is blind is weak only in one sense but the
one who is uneducated is weak by all senses. Introduction For every benefit received, there is
a cost which could be in form of tax also. Perhaps this seemed never so real than today in the
Indian context. The much thoughtful leaders of India have spared the education sector all along
from levy of taxes considering the importance of the same for the country.
If a country wants to grow manifold than building infrastructure for education and educated
infrastructure (people of the country) is a pre-requisite. The more knowledgeable the human
capital of a country is, more are its chances of development. While 'education' continues to be
of utmost importance for the country's economic growth, it also has been a priority for the
Government in extending tax benefits and other concessions to boost education (both primary
and professional / technical) in the country.
Goods and Services Tax (GST) as a tax reform Migrating to Goods and Services Tax (GST)
is a time to revinict the taxation and remove the anomalies. Almost 4% of the GDP is spent for
educating India’s hidden talent out of which 50% of the amount is spent for primary education
alone. Goods and Service Tax (GST) is a destination based consumption tax which is a levy of
tax on all goods and services with the objective of expanding the tax base through wide
coverage of economic activities , mitigating the cascading effect , reduction of exemptions ,
enable better compliances etc. thereby resulting into formation of common national market for
goods and services .
Present Scenario Education in India is presently covered as one of the priorities of the
Government and as such is allowed tax relief both in direct and indirect taxes. So far as indirect
taxes are concerned, education is considered as a service and as such it is subject to levy of
service tax. No other indirect tax is levied. For the purpose of service tax, education has been
distinguished from coaching or training which facilitates the education. Presently , educational
services are excluded from the levy of Service Tax and are in 'Negative List' under section
66D(i) which are related to delivery of education as ‘a part’ of the curriculum that has been
prescribed for obtaining a qualification prescribed by law.

Conduct of degree courses by colleges, universities or institutions which lead to grant of

qualifications recognized by law are also in negative list. Similarly, vocational training is also
out of tax net. However, training or coaching imparted by coaching institutes would, however,
not be covered in this exclusion as such training does not lead to grant of a recognized
qualification. Such services are liable to service tax but subject to exemption under Notification
No. 25/2012-ST dated 20.06.2012 vide entry no. 9 and 9A in relation to following services: 9.
Services provided,
(a) By an educational institution to its students, faculty and staff;
(b) To an educational institution, by way of,
(i) Transportation of students, faculty and staff;
(ii) Catering, including any mid-day meals scheme sponsored by the Government;
(iii) Security or cleaning or house-keeping services performed in such educational institution;
(iv)Services relating to admission to, or conduct of examination by, such institution
9A. Any services provided by
➢ the National Skill Development Corporation set up by the Government of India

➢ a Sector Skill Council approved by the National Skill Development Corporation
➢ an assessment agency approved by the Sector Skill Council or the National Skill
Development Corporation;
➢ a training partner approved by the National Skill Development Corporation or the
Sector Skill Council in relation to the
National Skill Development Programmed implemented by the National Skill Development

Corporation; or
A vocational skill development course under the National Skill Certification and Monetary
Reward Scheme; or
Any other Scheme implemented by the National Skill Development Corporation.

The present rate of service tax is 15% including cesses viz Swachh Bharat Cess (SBC) and
Krishi Kalyan Cess (KKC).
IN GST REGIME
According to the Model law on GST which neither contains the exemptions nor the rates of
taxation , it appears that all services in relation to coaching and training would be subject to
levy of GST as the scope of ‘service’ is very wide. However, the rates are expected to be in the
range of 18-20%.
In the proposed GST regime, GST shall be payable by taxable persons on the supply of goods
and services. Taxable person is defined in Section 9 of Model GST law which stipulates that
the Central Government , a State Government or any local authority shall be regarded as a
taxable person in respect of activities or transactions in which they are engaged as public
authorities other than the activities or transactions as specified in Schedule IV to the Act. Clause
3 of Schedule IV specifically provides that services provided by a Government or local
authority or a governmental authority by way of education shall not be regarded as a taxable
person.
Further, ‘education services’ have been defined in the said Schedule IV which means services
by way of
Pre-school education and education up to higher secondary school or equivalent
Education as a part of a curriculum for obtaining a qualification recognized by any law for the
time being in force; or

Education as a part of an approved vocational education course. Hence, the exemption may be
restricted to activities or transactions done by Central Government, State Government or any
Local Authority.
It, therefore, appears that education services provided by Government will not be taxable.
There is no specific provisions for inclusions or exclusions of coaching and training services
or any other activity related to education elsewhere in the proposed law.
Likely Impact in GST regime
Based on the provisions of Model Law , it can be said that education sector shall be impacted
both positively and negatively under the GST regime.
The rate of tax is likely to go up by 3-5% as it is expected that GST may be levied @18-20%.
If coaching is considered as an essential service, a lower GST rate is not ruled out.
There are likely to be concerns in valuation of coaching services in view of the industry practice
of discounts / concessions / scholarship. The proposed valuation rules are different from the
existing ones and as such coaching institutes need to frame an appropriate policy for such
discounts in advance making it a part of documentation.
Service providers having centralized registration will have to get registered in each state
whether providing coaching on own account or through agent (franchise).
Service providers will have an option to take different registration or separate business verticals
which needs to be examined on case to case basis.

The procedure for all the invoices / receipts towards inward and outward supplies will become
cumbersome as each one of them will have to be uploaded in the system.
The frequency and number of returns to be filed will go up.
There is a provision for GST audit if the turnover is more than Rs.1 crore.
The procedure for taking credit of input taxes will become simple and seamless which will
have a positive impact.
Benefits and Impact of GST on Education Sector
Education is one of the major sector for any economy. The education of country’s youth will
decide how the economy of that country will flourish. Education promotes understanding,
vision, creativity and productivity of people which helps in advancement of a country. In
India, education is provided both by public as well as private sectors.
Indian government’s foremost priority is to provide low cost education to one and all. That’s
why education sector enjoy lots of tax exemption as they are not taxed or comes in negative
list. The most important thing is that educational services and services related to the
education or higher education provided to the students is covered under the Goods and
Services Tax (GST) exempt list. The educational institutions that have been granted the
exemption from GST are pre-schools and higher secondary educational institutes – both
private and Government.

Exemption Education Services Under GST
The educational services exempted under GST are assessment and examination fees,
curriculum related or course materials, excursion and field trips related to the course of study
or part of curriculum requirement; except for food and accommodation supplied on those
trips, and student administrative services such as registration, printing of academic
transcripts, issuing or replacement of student cards, late fee payments, administration of the
library etc.
The educational services provided by the Assessment agencies approved by the Sector Skill
Council or the National Skill Development Corporation, National Skill Development
Corporation set up by the Government of India, Sector Skill Councils approved by the
National Skill Development Corporation, and Training partners approved by the National
Skill Development Corporation or the Sector Skill Council are also exempted from GST.
Read More: GST Impact on GDP
Non-Exempted Educational Services under GST
The educational services that are not exempted from GST are after school activities offered
directly by third parties, food and accommodation supplied for excursion, supplies provided
by third parties like musical instrument, computers, sports equipment, and uniform,
stationery, and other non-academic related supplies.
The educational services led by training and coaching foundations are also not exempted
from GST. Let’s have a look at them.
1. Higher Education Institutions and Private Institutions

The exemption under GST has been granted for pre-schools till higher secondary education.
Since universities and other advanced educational institutions have not been mentioned in the
exception list, 18% GST is expected to be levied on this.

Higher education in the private segment will end up being more costly and in turn,
competition for admissions in government schools/colleges/foundations will increase. There
will be a 3 to 5% of the obligation jump on the administration costs that will over the long
haul impact the common man. The middle class families who obtain education loans or put
their life-long savings into educating their wards at reputed institutions will be facing the
inconvenience.
2. Coaching Institutes
As clearing competitive exams and entrance exams seems impossible without taking
professional coaching, coaching institutes form an integral part of education. GST has raised
the tax rate to 18% from 14% for these coaching institutes. The parents whose children are
about to start coaching for IITs and other competitive examinations will be facing the
inconvenience.
3. Cost of Organizing Events
When foreign entities organize any educational or training events in India which are attended
by professionals, individuals and overseas participants would be taxed under GST.
Apart from the exemption, the private education is likely to get expensive up to 2 or 3% after
GST rolled out in India. Even if the lowest tax slab of 5% is applied, the chances are high to
get it expensive according to the research and analysis of all the provisions of the bills
introduced.
The GST slab rate of 5% is considered as lowest and thus, the government is requested to
frame the laws in such a manner that the tax rate and input tax credit allowed in the education
industry can share a load of taxation further improving the conditions.

IMPACT OF GST ON STUDENTS
GADGETS
Mobile phones are likely to get costlier as the GST on phones manufactured in India has been
increased. On the other hand, phones imported from foreign countries will become cheaper. To
be exact, the cost will increase by 4-5 per cent with the government imposing a goods and
services tax (GST) of 12 per cent, taking away the benefit under duty differential that was being
offered to local manufacturers. The tax on laptops will be increased from 14-15 per cent to 18
per cent so all in all, electronic items will pinch students pocket more than before.
FOOD
Eating outside might become difficult now as GST of 12 per cent will be levied on non-air
conditioned restaurants which are most frequented by the students. Guess it's time to eat more
at the hostel canteen.

CLOTHS
One of the most exciting things about joining college is the need to not wear a uniform. The
attempt to look your glamorous best but it might become a little challenging for now as the
clothes which cost Rs 1000 or more per piece, will attract a GST of 12 per cent compared to 5
per cent earlier.
HOSTEL FACILITIES AND STATIONARY
Services like laundry, food in hostel mess, medicine, stationary and other services and products
will now attract a GST of 18 per cent, increasing the ex penses considerably. Since stamps,
judicial papers, printed books and newspapers come under the 0 per cent tax bracket, items of
daily use by students such as school bags, colouring books and notebooks will become cheaper.

Chapter 3
LITERATURE REVIEW
The proposed GST is likely to change the whole scenario of current indirect tax system. It is
considered as biggest tax reform since 1947. Currently, in India complicated indirect tax system
is followed with imbrications of taxes imposed by union and states separately. GST will unify
all the indirect taxes under an umbrella and will create a smooth national market. Experts say
that GST will help the economy to grow in more efficient manner by improving the tax
collection as it will disrupt all the tax barriers between states and integrate country via single
tax rate. GST was first introduced by France in 1954 and now it is followed by 140 countries.
Most of the countries followed unified GST while some countries like Brazil, Canada follow a
dual GST system where tax is imposed by central and state both. In India also dual system of
GST is proposed including CGST and SGST.
Pinki, Supriya Kamma and Richa Verma (July 2014) studied, “Goods and Service
Tax- Panacea For Indirect Tax System in India” and concluded that the new NDA government
in India is positive towards implementation of GST and it is beneficial for central government,
state government and as well as for consumers in long run if its implementation is backed by
strong IT infrastructure.
Agogo Mawuli (May 2014) studied, “Goods and Service Tax-An Appraisal” and found that
GST is not good for low-income countries and does not provide broad based growth to poor
countries. If still these countries want to implement GST then the rate of GST should be less
than 10% for growth.
Nitin Kumar (2014) studied, “Goods and Service Tax- A Way Forward” and concluded that
implementation of GST in India help in removing economic distortion by current indirect tax
system and expected to encourage unbiased tax structure which is indifferent to geographical
locations.

Nishitha Guptha (2014) in her study stated that implementation of GST in the Indian
framework will lead to commercial benefits which were untouched by the VAT system and
would essentially lead to economic development. Hence GST may usher in the possibility of a
collective gain for industry, trade, agriculture and common consumers as well as for the Central
Government and the State Government.
Jaiprakash ( 2014) in his research study mentioned that the GST at the Central and the State
level are expected to give more relief to industry, trade, agriculture and consumers through a
more comprehensive and wider coverage of input tax set-off and service tax setoff, subsuming
of several taxes in the GST and phasing out of CST. Responses of industry and also of trade
have been indeed encouraging. Thus GST offers us the best option to broaden our tax base and
we should not miss this opportunities to introduce it when the circumstances are quite favorable
and economy is enjoying steady growth with only mild inflation.
Saravanan Venkadasalam (2014) has analysed the post effect of the goods and service
tax (GST) on the national growth on ASEAN States using Least Squares Dummy Variable
Model (LSDVM) in his research paper. He stated that seven of the ten ASEAN nations are
already implementing the GST. He also suggested that the household final consumption
expenditure and general government consumption expenditure are positively significantly
related to the gross domestic product as required and support the economic theories. But the
effect of the post GST differs in countries. Philippines and Thailand show significant negative
relationship with their nation’s development. Meanwhile, Singapore shows a significant
positive relationship. It is undeniable that those countries whom implementing GST always
encounter grows. Nevertheless, the extent of the impact varies depending on the governance,
compliance cost and economic distortion. A positive impact of GST depends on a neutral and
rational design of the GST such a way it is simple, transparent and significantly enhances
involuntary compliance. It must be actual, not presumptive, prices and compliance control
would be exercised through an auditing system.
Dr. R. Vasanthagopal (2011)studied,“GST in India: A Big Leap in the Indirect Taxation

System” and concluded that switching to seamless GST from current complicated indirect tax
system in India will be a positive step in booming Indian economy. Success of GST will lead
to its acceptance by more than 130 countries in world and a new preferred form of indirect tax
system in Asia also.

Fabian Christandl, Detlef Fetchenhauer and Erik Hoelzl (2011) conducted a

study 2 months before and after a raise in value-added tax (VAT), 303 participants had to
estimate the current prices for four products affected and four products not affected by this
raise in VAT and the anticipated or recalled prices of these products. Before the VAT increase,
an undifferentiated belief in strong future price increases was prevalent. After the VAT
increase, a confirmation bias was found: in retrospect, participants reported price increases that
were significantly higher than the official price development and in line with an
undifferentiated belief in marked price increases.
Michael Keen and Ben Lockwood (2010) explored the causes and consequences of the
remarkable rise of the value added tax (VAT). It is observed that the introduction of a VAT,
reduces the marginal cost of public funds and it leads an optimizing government to increase
the tax ratio. This leads to the estimation, on a panel of 143 countries for 25 years, of a system
describing both the probability of VAT adoption and the revenue impact of the VAT. The
results point to a rich set of determinants of VAT adoption, and to asignificant but complex
impact on the revenue ratio. The estimates suggest, very tentatively, that most countries which
have adopted a VAT have thereby gained a more effective tax instrument, though this is less
apparent in sub-Saharan Africa.[8] • Ehtisham Ahmed and Satya Poddar (2009) studied,
“Goods and Service Tax Reforms and Intergovernmental Consideration in India” and found
that GST introduction will provide simplier and transparent tax system with increase in output
and productivity of economy in India. But the benefits of GST are critically dependent on
rational design of GST.

❖ Chapter 4
CONCLUSION
In the present scenario, while Cenvat Credit on all inputs / input services is not available, once
the GST would be implemented, tax component will also increase by 3-5% resulting in an
increase of cost of services to the end user i.e., students.
In fact, undeniably, education / coaching institutions play an
important role in fulfilling the objectives of various students as well as parents, thus should be
zero-rated and be exempted from Goods and Services Tax to lessen the financial burden on
parents as well as students. Doing so will not only help improve the quality of education,
students and life but also facilitate India to leap frog in the trajectory of top economic powers
of the world as India is poised to be so by 2030, given its demographic strength.
Therefore, in order to provide real benefit to the education sector, seamless credit should be
allowed across the supply chain so that even if GST comes into force, the total cost of education
will be lower that what it is today. The idea of zero-rated tax on inputs must be, thus, explored.
The lacunas in the present regime of indirect taxation in India demands for the major
breakthrough in this field for facilitating the ease of doing business effectively and efficiently.
Hopefully, GST is going to be pinnacle which aims at evolving an efficient and harmonized
consumption or destination based tax system and will remove the problems faced by the sector
leading to cost optimization and free flow of transactions.

WEBLIOGRAPHY
https://www.deskera.in/gst-impact-on-education-sector-benefits-and-impacts/
https://incometaxindiaefiling.gov.in/
https://www.gst.gov.in/

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PRAHLADRAI DALMIA LIONS COLLEGE OF COMMERCE AND ECONOMICS

➢ Specified in the income tax ACT 1961

IMPACT OF GST ON EDUCATION SECTOR 1

Defination of Good and Service Tax (GST)

IMPACT OF GST ON EDUCATION SECTOR 2

What is Goods and Service Tax (GST)

How the GST system works

INDIA’S ADOPTION OF THE GST

IMPACT OF GST ON EDUCATION SECTOR 3

IMPACT OF GST ON EDUCATION SECTOR 4

CGST (CENTRAL GOODS AND SERVICE TAX)

SGST (STATE GOODS AND SERVICE TAX)

IMPACT OF GST ON EDUCATION SECTOR 5

UTGST (UNION TERRITORY GOODS AND SERVICE TAX)

IGST (INTEGRATED GOODS AND SERVICE TAX)

IMPACT OF GST ON EDUCATION SECTOR 6

GST RATES ON GOODS

➢ Hulled cereal grains like barley, wheat, oat, rye, etc.

12% TAX SLAB

IMPACT OF GST ON EDUCATION SECTOR 8

18% TAX SLAB

IMPACT OF GST ON EDUCATION SECTOR 9

➢ Electrical Filaments or discharge lamps

28% TAX SLAB

IMPACT OF GST ON EDUCATION SECTOR 10

GST RATES ON SERVICES

➢ Railways-Transportation of goods, passengers

12% TAX SLAB

IMPACT OF GST ON EDUCATION SECTOR 11

18% TAX SLAB

➢ Food/drinks at restaurants with liquor license

28% TAX SLAB

IMPACT OF GST ON EDUCATION SECTOR 12

IMPACT OF GST ON EDUCATION SECTOR

➢ Pre-school education and education up to higher secondary school or equivalent or

IMPACT OF GST ON EDUCATION SECTOR 13

IMPACT OF GST ON EDUCATION SECTOR

IMPACT OF GST ON EDUCATION SECTOR 14

Conduct of degree courses by colleges, universities or institutions which lead to grant of

(a) By an educational institution to its students, faculty and staff;

(b) To an educational institution, by way of,

(i) Transportation of students, faculty and staff;

(iii) Security or cleaning or house-keeping services performed in such educational institution;

(iv)Services relating to admission to, or conduct of examination by, such institution

9A. Any services provided by

➢ the National Skill Development Corporation set up by the Government of India

National Skill Development Programmed implemented by the National Skill Development

Any other Scheme implemented by the National Skill Development Corporation.

IMPACT OF GST ON EDUCATION SECTOR 15

Pre-school education and education up to higher secondary school or equivalent

IMPACT OF GST ON EDUCATION SECTOR 16

Likely Impact in GST regime

IMPACT OF GST ON EDUCATION SECTOR 17

The frequency and number of returns to be filed will go up.

Benefits and Impact of GST on Education Sector

IMPACT OF GST ON EDUCATION SECTOR 18

Exemption Education Services Under GST

Non-Exempted Educational Services under GST

1. Higher Education Institutions and Private Institutions

IMPACT OF GST ON EDUCATION SECTOR 19

3. Cost of Organizing Events

IMPACT OF GST ON EDUCATION SECTOR 20

IMPACT OF GST ON STUDENTS