Education and Training Sector in India is among the key priority areas of government. Government’s focus towards education sector is well reflected through various exemptions in Service Tax and Value Added Tax.
However, it’s hard to accommodate every concern of an educational and training sector. In contrast to certain exemptions, the education, and training sector has borne the burden of indirect taxes in certain situations. Prescribed courses by IIM have been exempted under GST. In addition, the specific services such as transportation of students, catering, and security in pre-school education and higher secondary education have been exempted under GST. Though, the courses and educational services would encourage the GST exemption, education institutions still have to bear GST burden for the following procurement:
- Services such as renting, telecommunication, and purchase of goods will continue to remain as an input tax cost for educational institutions.
- Training Services by commercial coaching institute will have to bear GST the rate of 18%.
- Foreign entities organizing educational training events in India that is attended by local or overseas participants will become liable to bear GST.
Now, it calls for education and training sector to keep a close watch on GST along with the subsequent exemptions and their related clarifications.