Impact of GST on Education Sector

The educational institutions that have been granted the exemption from GST are pre-schools and higher secondary educational institutes both private and Govt.

The Right of Children to Free and Compulsory Education Act of 2009 has made education not only compulsory but has also made the Govt. responsible to provide education at economical rates. The  Council has kept education sector free from its ambit.

Services related to education, provided by any educational institution to its students, faculty and staff like transportation, catering, mid day meals, admissions, examinations, housekeeping etc. have been exempted under GST. The educational institutions that have been granted the exemption from GST are pre-schools and higher secondary educational institutes both private and Govt.

The exemption has also been granted to the services provided by the Indian Institutes of Management to their students, by way of the –

1. 2 year full-time residential PG programs in Management  for Post Graduate Diploma in Management, admission in which is granted via CAT
2. Fellowship programs in Management
3. 5 Year Integrated Programs in management studies (but excludes the Executive Development Program).

The education services provided by the below are also exempted from GST:

1. National Skill Development Corporation set up by the Government of India
2. Sector Skill Councils approved by the National Skill Development Corporation
3. Assessment agencies approved by the Sector Skill Council or the National Skill Development Corporation
4. Training partners approved by the National Skill Development Corporation or the Sector Skill Council are also included w.r.t the following programs:
(a) the National Skill Development Programme implemented by the National Skill Development Corporation
(b) a vocational skill development course under the National Skill Certification and Monetary Reward Scheme
(c) any other Scheme implemented by the National Skill Development Corporation”.

However, as the educational services led by training and coaching foundations don’t help in getting legally perceived qualifications therefore these are not exempted from GST. Let us take a look at them:

1. Higher Education Institutions and Private Institutions
The exemption under GST has been granted just for pre-schools till higher secondary education and since universities and other advanced educational institutions have not been mentioned in the exception list, and thus GST of 18% is expected to be levied on this.

Higher education in the private segment will end up being more costly and in turn, rivalry for admissions in government schools/colleges/foundations will increment. There will be a 3 to 5% of the obligation jump on the cost of administrations that will over the long haul impact the common man. The burden will be the most on middle class families who obtain education loans or put their life-long savings into educating their wards at reputed institutions.

2. Coaching Institutes
Coaching institutes form an integral part of education today as clearing competitive exams and entrance exams seems just impossible without taking professional coaching on how to clear and attempt them. GST has raised the rate of taxes to 18% from 14% for these coaching institutes. This will be a burden for all parents whose child is about to start coaching for IITs and other competitive examinations.

3. Cost of Organizing Events
Any educational/training events organized in India by foreign entities which are attended by professionals, individuals and overseas participants as well would be taxed under GST.

Comments

Post a Comment

Popular posts from this blog

Activities to be treated as supply of services or supply of goods

As GST is in full swing from 1st July 2017 there are many query related to fact that which activity to be treated as supply of goods and which activities to be treated as supply of services. So this article encompass the topic i.e. Activities to be treated as supply of Goods or supply of services. Schedule 2 of CGST act tells us about the activities to be treated as supply of goods or supply of services. 1. Transfer (a) Any transfer of the title in goods is a supply of goods; (b) Any transfer of right in goods or of undivided share in goods without the transfer of title thereof, is a supply of services; (c) Any transfer of title in goods under an agreement which stipulates that property in goods shall pass at a future date upon payment of full consideration as agreed, is a supply of goods. 2. Land and Building (a) Any lease, tenancy, easement, licence to occupy land is a supply of services; (b) Any lease or letting out of the building including a commercial, industrial
Read more

Amendment of Non-Core Fields in GST Registration is now available

Image
For Amendment of Non-Core Fields in GST Registration: First login into www.gst.gov.in  then click "Services"  then click on "Registration" and  then Choose " Amendment of Registration Non-Core Fields " Amendment can be done in respect of :  i) Addition of Registration Nos of Pre-GST Act,  ii) Modification of Mobile Number and E-mail ID,  iii) Modification or addition of Authorized Signatory,  iv) Addition or modification in Goods and Services,  v) Addition or modification of bank details,  vi) Modification of personal details of Proprietor
Read more

Deadline for Aadhaar-PAN linkage to stay: UIDAI CEO

Tax payers will have to link their PAN with Aadhaar by the stipulated deadline, which is this month-end, as the Supreme Court verdict on privacy has no bearing on the requirement, UIDAICEO Ajay Bhushan Pandey has said.  The requirement for Aadhaar being quoted for availing government subsidies, welfare schemes and other benefits will also continue unhindered for now, he told PTI.  The government had mandated linking of PAN with Aadhaar by the extended deadline of August 31. Asked about the implication of the Supreme Court ruling (privacy being a fundamental right) on linking of Aadhaar and PAN, Pandey said: "There also, linking of PAN to Aadhaar is mandated by an amendment in income tax act...the linking will continue under that act and law. There is no change". Pandey said various deadlines that have been prescribed, be it under provision of Aadhaar Act, Income Tax Act or money laundering rules will "have to be adhered to" as "those laws are valid". 
Read more