The Central Board of Indirect Taxes and Customs (CBIC) has clarified that coaching centres are liable to pay Goods & Services Tax (GST) at the rate of 18% on their composite supply to students.
While, generally the coaching institutes also provide notebooks, bags, t-shirts, sweatshirts, etc., to students and coaching services and institutes charge a lump sum amount from students. The department found that the coaching institutes pay GST separately on an individual item basis and clarified that these bundled services fall under composite supply and attract 18% GST.
In this regard, CBIC chairman Vivek Johri said in a weekly communication “These types of bundled services fall under the category of ‘Composite Supply’ and attract 18 % GST,”. He also cited a case of tax evasion amounting to Rs 3.6 crore detected by the Alwar CGST Commissionerate.