Govt considering GST on private higher education: Report

NEW DELHI, OCTOBER 11: The Central Government is exploring the possibility of levying the Goods and Services Tax, or GST, on education in private colleges and universities, said reports.

The Business Standard reported on Friday that to meet the revenue collection target for 2019-’20, the finance ministry is considering taxing private healthcare and education. At present, private education is GST-exempt.

Following the roll-out of the GST, which subsumed a number of local taxes, in July, 2017, there was much confusion over the tax levied on services such as hostel catering, security and maintenance on college campuses. Many reported an 18% tax on these services which were followed by clarifications saying there was no tax at all, at least on hostel catering. By January 2018, the Central Board of Excise and Customs had settled on a 5% GST on hostel catering. Tuition on traditional educational programmes, however, was always exempt.

GST review

The GST is up for a full scale review in general. The Times of India reported that on Thursday the government established a 12-member committee of central and state government officials to recommend ways to improve collection and administration. According to the Business Standard, sectors that have not been taxed at all may see a 5% tax and those in the 5% tax slab may be shifted to a higher slab. According to the reports, some slabs may be merged.

The exercise has been prompted by a revenue crunch. An official told the Business Standard: “The study is being done because revenue growth has weakened, and the primary reason is that many value chains are not yet under the GST net.”

An official from the Ministry of Human Resource Development said that they were not aware of such a plan.