- Seth & Associates
GST on Goods Transport Agency
WHO IS A GTA
As per Section 65B (26) of the Finance Act, 1994; “Goods Transport Agency means any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name called”. Therefore, in the Service Tax regime, issuance of Consignment Note (C/N) was integral and mandatory requirement before any road transporter could be brought within the ambit of GTA.
RATE OF TAX RATE OF TAX RATE OF TAX To be levied at 12% in case the GTA avails Input Tax credit while suppling the service else to be levied at 5%
PERSON LIABLE TO PAY
In case the tax is to be paid at 5% then the person who is the recipient of the supply is supposed to discharge the liability and not the supplier (reverse charge). Following the recepients upon which the duty has been casted. a) Any factory registered under or governed by the Factories Act, 1948(63 of 1948); or b) any society registered under the Societies Registration Act, 1860 (21 of 1860) or under any other law for the time being in force in any part of India; or c) any co-operative society established by or under any law; or d) any person registered under the Central Goods and Services Tax Act or the Integrated Goods and Services Tax Act or e) the State Goods and Services Tax Act or theUnion Territory f) any body corporate established, by or under any law; or g) any partnership firm whether registered or not under any law including association of persons; or h) any casual taxable person.
Services provided by a GTA, by way of transport in a goods carriage of: a) agricultural produce; b) goods, where consideration charged for the transportation of goods on a consignment transported in a single carriage c) does not exceed one thousand five hundred rupees; d) goods, where consideration charged for transportation of all such goods for a single consignee does not exceed e) rupees seven hundred and fifty; f) milk, salt and food grain including flour, pulses and rice; g) organic manure; h) newspaper or magazines registered with the Registrar of Newspapers; i) relief materials meant for victims of natural or man-made disasters, calamities, accidents or mishap; or j) defence or military equipments. Similarly, the following services received by the GTA (Heading 9966 or 9973) is also exempt in terms of notification no.12/2017- Central Tax (Rate) dated 28.06.2017 (sr.no.22) Services by way of giving on hire : (b) to a goods transport agency, a means of transportation of goods
To qualify as services of GTA, the GTA should be necessarilyissuing a consignment note. Only services provided by a GTA are taxable under GST. Services of transportation of goods by a person other than GTA are exempt. Moreover, in cases where the service of GTA is availed by the specified categories of persons in the taxable territory, the recipients who avail such services are the ones liable to pay GST and not the supplier of services unless the GTA opts for collecting and paying taxes @ 12% (6% CGST + 6% SGST).