Tax Insights

from India Tax & Regulatory Services

CBEC issues notifications for

amending tax rates on specified
services

August 24, 2017

In brief
The CBEC has issued notification nos. 20-23/2017-Central Tax (Rate) dated 22 August, 2017
amending tax rates on specified services.

In detail
The details of changes made in each of the notifications are as follows:
Notification no. 20/2017 – change in effective rates of services

Sr. Description New Existing tax Additional Comments

No. effective tax rate conditions
rate (considering
(considering SGST same as
SGST same CGST)
as CGST)
1 Composite supply of 12% 18% NA
specified works
contracts supplied to
the Government, local
authority or
Governmental
authority (e.g. canal,
dam or other irrigation
works, water pipeline,
water treatment plant,
sewarage treatment
plant etc.)

2 Composite supply of 12% 18% NA

specified works
contracts for listed
infrastructure projects
(e.g. roads, bridges,
pollution control or
effluent treatment
plant except located as
a part of factory etc.)

www.pwc.in
Tax Insights

Sr. Description New Existing tax Additional Comments

No. effective tax rate conditions
rate (considering
(considering SGST same as
SGST same CGST)
as CGST)
3 Composite supply of 12% 18% NA
specified works
contracts for listed
infrastructure projects
(railways excluding
monorail and metro,
low cost housing
meeting specific
conditions, etc.)

4 Transport of 5% (without 5% (without ITC) If the service

passengers by motor ITC) supplier opts to
cab where the cost of avail ITC, he needs
or
fuel is included in the to levy GST @12%.
consideration charged 12% (with
from the service ITC)
recipient

5 Services provided by 5% (without 5% (without ITC GTA opting to pay

GTA in relation of ITC under under reverse tax under forward
transport of goods reverse charge) charge and
(including used house charge) claiming credit, will
hold goods for personal be henceforth liable
or
use), including to pay GST @12%
supporting services 12%(with ITC on all GST services
under forward supplied by him.
charge)

6 Renting of motor-cab 5% (without 5% (without ITC) If the service

where the cost of fuel is ITC) supplier opts to pay
included in the tax @12%, he can
or
consideration charged avail ITC.
from the service 12% (with
recipient ITC)

7 Services by way of job 5% 18% The jobwork for textile

work for textile yarns (other than of
products other than manmade fibres) and
textile yarns (other textile fabrics was
than of manmade already subject to tax
fibres) and textile @ 5% and the lower
fabrics rate of tax has been
extended to job work of
all other textile
products as well.

8 Services by way of 5% 18%

treatment or process
on goods belonging to
another person, in
relation to printing of
newspapers

PwC Page 2
Tax Insights

Sr. Description New Existing tax Additional Comments

No. effective tax rate conditions
rate (considering
(considering SGST same as
SGST same CGST)
as CGST)
9 Services by way of 12% 18%
printing of
newspapers, books
(including Braille
books), journals and
periodicals, where only
content is supplied by
the publisher and the
physical inputs
including paper used
for printing belong to
the printer

10 Services by way of 18% It is a new entry.

admission or access to
planetarium

Notification no. 21/2017 – exemptions from GST on services

Sr. Nature of services Conditions Comments

No.

1 Services provided by and to FIFA Director (Sports), Ministry of

and its subsidiaries directly or
indirectly related to any of the
events under FIFA U-17 World
Cup 2017 to be hosted in India
Youth Affairs and Sports
certifies that the services are
directly or indirectly related to
any of the events under FIFA
U-17 World cup 2017.

2 Services provided by fair price

shops to Central Government by
way of sale of wheat, rice and
coarse grains under PDS for
consideration in the form of
commission or margin

3 Service provided by fair price

shops to State Governments or
Union territories by way of sale of
kerosene, sugar, edible oil, etc.
under PDS for consideration in
the form of commission or margin

4 General insurance services The words “Weather Based Crop

provided under Restructured Insurance Scheme or the Modified
Weather Based Crop Insurance National Agricultural Insurance
Scheme Scheme” are replaced by
“Restructured Weather Based Crop
Insurance Scheme” in entry 35 (h) of
the notification 12/2017.

PwC Page 3
Tax Insights

Sr. Nature of services Conditions Comments

No.

5 General insurance services The words “National Agricultural

provided under Pradhan Mantri Insurance Scheme (Rashtriya Krishi
Fasal Bima Yojana (PMFBY) Bima Yojana)” are replaced by
“Pradhan Mantri Fasal Bima Yojana
(PMFBY)” in entry 35 (j) of the
notification 12/2017.

Further, an explanation is
inserted in the notification,
mentioning that for the purpose
of this notification, a Limited
Liability Partnership (LLP)
formed and registered under the
provisions of the LLP Act, 2008
shall be considered as a
partnership firm or firm.
Notification no. 22/2017 –
amendments in the services,
where GST is payable under
reverse charge
A consequential amendment is
made to exclude from reverse
charge liability, the cases where
GTA is paying tax @12% under
forward charge.
Further, an explanation is
inserted in the notification,
mentioning that for the purpose
of this notification, a LLP formed
and registered under the
provisions of the LLP Act, 2008
shall be considered as a
partnership firm or firm.
Notification no. 23/2017 –
amendments in the list of
services, where the e-
Commerce operator is liable
to pay GST
In the list of services, where the e-
Commerce operator is liable to
pay GST if the services are
supplied through it, the following
service is added:
 Services by way of house-
keeping, such as plumbing,
carpentering etc., except
where the person supplying
such service through electronic
commerce operator is liable
for registration under section
22(1) of the CGST Act.
PwC comments
These amendments give effect to
the decisions taken by GST
Council during the meeting on 05
August, 2017. The reduction in
rate of tax for composite supply of
works contract services for
specified projects would reduce
the impact on the cost of such
projects. The projects covered are
similar to the projects exempt
under the mega exemption
notification in the service tax law.
Let’s talk
For a deeper discussion of how
this issue might affect your
business, please contact your
local PwC advisor

PwC Page 3
Tax Insights

Our Offices

Ahmedabad Bengaluru Chennai

1701, 17th Floor, Shapath V, 6th Floor 8th Floor
Opp. Karnavati Club, Millenia Tower ‘D’ Prestige Palladium Bayan
S G Highway, 1 & 2, Murphy Road, Ulsoor, 129-140 Greams Road
Ahmedabad – 380051 Bengaluru – 560 008 Chennai – 600 006
Gujarat Karnataka Tamil Nadu
+91-79 3091 7000 +91-80 4079 7000 +91 44 4228 5000

Hyderabad Kolkata Mumbai

Plot no. 77/A, 8-2-624/A/1, 4th 56 & 57, Block DN. PwC House
Floor, Road No. 10, Banjara Hills, Ground Floor, A- Wing Plot No. 18A,
Hyderabad – 500034 Sector - V, Salt Lake Guru Nanak Road(Station Road),
Telangana Kolkata – 700 091 Bandra (West), Mumbai – 400 050
+91-40 44246000 West Bengal Maharashtra
+91-033 2357 9101/ +91-22 6689 1000
4400 1111

Gurgaon Pune For more information

Building No. 10, Tower - C 7th Floor, Tower A - Wing 1, Contact us at
17th & 18th Floor, Business Bay, Airport Road, pwctrs.knowledgemanagement@in.pwc.com
DLF Cyber City, Yerwada, Pune – 411 006
Gurgaon – 122002 Maharashtra
Haryana +91-20 4100 4444
+91-124 330 6000

About PwC
At PwC, our purpose is to build trust in society and solve important problems. We’re a network of firms in 157
countries with more than 223,000 people who are committed to delivering quality in assurance, advisory and tax
services. Find out more and tell us what matters to you by visiting us at www.pwc.com.

In India, PwC has offices in these cities: Ahmedabad, Bengaluru, Chennai, Delhi NCR (Gurgaon), Hyderabad, Kolkata,
Mumbai and Pune. For more information about PwC India's service offerings, visit www.pwc.com/in

PwC refers to the PwC International network and/or one or more of its member firms, each of which is a separate,
independent and distinct legal entity. Please see www.pwc.com/structure for further details.

©2017 PwC. All rights reserved

Follow us on:

For private circulation only

This publication has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information
contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness
of the information contained in this publication, and, to the extent permitted by law, PwCPL, its members, employees and agents accept no liability, and disclaim all
responsibility, for the consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based
on it. Without prior permission of PwCPL, this publication may not be quoted in whole or in part or otherwise referred to in any documents.

© 2017 PricewaterhouseCoopers Private Limited. All rights reserved. In this document, “PwC” refers to PricewaterhouseCoopers Private Limited (a limited liability company
in India having Corporate Identity Number or CIN : U74140WB1983PTC036093), which is a member firm of PricewaterhouseCoopers International Limited (PwCIL), each
member firm of which is a separate legal entity.