New Delhi: Soon, the economic theory that whatever goods and services are provided –the expense of the same must have been borne by someone, is going to hold true in case of employee-employer CTC agreement. That is, you don’t get anything for free!
Come July 1 and leasing of land, renting of buildings as well as EMIs paid for purchase of under-construction houses will start attracting the Goods and Services Tax.
There is something more that can be covered under the ambit of GST. As per a report in the Times of India free lunch, car drops, scholarship to employee’s children, that are normally not part of the CTC package, can attract GST
However, gifts not exceeding “Rs 50,000 in value in a financial year by an employer to an employee shall not be treated as supply of goods and services”, the TOI report said.
GST, which the government intends to roll out from July 1, 2017, will subsume central excise, service tax and state VAT among other indirect levies on manufactured goods and services.
The Central GST (CGST) bill — one of the four legislations introduced, states that any lease, tenancy, easement, licence to occupy land will be considered as supply of service.
Sale of land and buildings will be however out of the purview of GST, the new indirect tax regime.
Such transactions will continue to attract the stamp duty, according to the legislations Finance Minister Arun Jaitley introduced in the Lok Sabha yesterday for approval.
Electricity has also been kept out of the GST ambit.