The Government of Jharkhand on August 14th 2024, issued a significant update which amends the earlier notification on GST rates. This update introduces several key changes affecting the taxation of services provided by Indian Railways and accommodation services.
1. New GST Exemptions for Indian Railways Services
The latest amendment introduces three new serial numbers in the GST rate table, focusing on services provided by Indian Railways.
Serial Number 9E: Services Provided to Individuals by Indian Railways
This entry outlines exemptions for certain services provided directly to individuals by the Ministry of Railways. These services include:
- Sale of Platform Tickets: Tickets purchased for access to railway platforms.
- Facility of Retiring Rooms/Waiting Rooms: Charges for using waiting or retiring rooms at railway stations.
- Cloak Room Services: Fees for storing luggage in cloak rooms.
- Battery Operated Car Services: Services involving battery-operated cars within railway premises.
These services are now exempt from GST, ensuring that passengers enjoy these facilities without additional tax burdens.
Serial Number 9F: Intra-Zonal/Division Services
This entry covers transactions between different zones or divisions under the Ministry of Railways. It specifies that:
- Services Provided by One Zone/Division to Another Zone/Division: Such services are exempt from GST. This provision is intended to simplify the accounting for inter-divisional services within the railway network.
Serial Number 9G: Services Involving Special Purpose Vehicles (SPVs)
Here, the amendment addresses the transactions involving Special Purpose Vehicles (SPVs) and Indian Railways. It includes:
- Use of Infrastructure by Indian Railways: SPVs that have built infrastructure and allow Indian Railways to use it during the concession period are exempt from GST.
- Maintenance Services Provided by Indian Railways to SPVs: Similarly, maintenance services provided by Indian Railways to SPVs related to the infrastructure are also exempt.
These exemptions aim to facilitate smoother operations and financial transactions related to railway infrastructure.
2. Amendments to Existing GST Entries
The notification also modifies existing GST entries concerning accommodation services:
Serial Number 12: Changes to Accommodation Service Exemptions
Column (2): The words “Heading 9963 or” are removed from the entry. This adjustment simplifies the identification of the relevant service category.
Column (3):
Explanation 1: Previously existing explanation is now renumbered.
Explanation 2: A new explanation specifies exclusions from the entry:
Accommodation for Students: Services related to accommodation in student residences are excluded from the exemption.
Hostels and Similar Accommodations: Hostels, camps, paying guest accommodations, and similar services are also excluded.
These changes refine the scope of accommodation service exemptions, making it clear which types of accommodation are not eligible for GST exemptions.
New Serial Number 12A: Accommodation Services
- 12A: Introduces a new category for accommodation services where the value is ≤ ₹20,000 per person per month, provided the accommodation is for a continuous period of at least 90 days. This entry ensures that long-term accommodation services at a lower cost are exempt from GST.
Effective Date and Implications
These amendments are effective from July 15, 2024. Businesses and service providers should adjust their accounting practices and invoicing accordingly to reflect these changes. Consumers, especially those utilizing railway services or staying in accommodations, will benefit from reduced tax burdens on specified services. By clarifying GST rates and exemptions, the Jharkhand Government aims to support both service providers and consumers, ensuring smoother transactions and financial planning.
