18% GST on glaciers

New Delhi: The Central Board of Excise and Customs (CBIC) has clarified that ice cream sold by a parlor or such outlets will be subject to an 18% Goods and Services Tax (GST) with sales tax credit. inputs as part of an in-depth clarification of tax liability on a host of goods and services.

The federal tax agency mentioned in a circular that past tax assessments of ice cream parlors that attracted GST at the rate of 5% with no input tax credit should be treated as fully paid GST to avoid unnecessary litigation. In addition, it has been clarified that the higher rate will be effective from October 6, 2021.

The Center gave ice cream parlors a break since the 18 per cent GST was not in effect retrospectively.

“Since the decision is only to regularize past practice, no refund of GST will be allowed, if it has already been paid at 18%,” the CBIC said.

It is worth mentioning here that the almighty GST Council recommended last September to levy GST on ice cream parlors at the rate of 18% with input tax credit, not 5% without input tax credit. inputs, pointing out that because they sell already manufactured goods, they are not restaurants and therefore subject to GST at the higher rate.
Furthermore, in the same circular, the Ministry of Finance stated that the amount or fees charged to prospective students for entry or admission, or for the issuance of certificates of eligibility and services associated with freight in transit to and from Nepal and Bhutan, are exempt from GST.

The circular also explained that cancellation fees collected by hotels, tour operators and tour operators will be taxed at the same rate of GST that applies to the main service.

He clarified that an electric vehicle, with or without batteries, will be subject to a 5% GST rate, while mangoes, other than fresh mangoes, sliced ​​mangoes and dried mangoes, will be subject to a 12% GST.

Saurabh Agarwal, Tax Partner, EY, told ET: “The proactive step taken by the CBIC in releasing the current clarifications will likely benefit industries across a variety of sectors.”