The controversy around levying Goods and Services Tax on intermediaries has come back to the fore and the Gujarat High Court is planning to relook at the controversy.

The issue is whether certain Indian units of multinationals or BPOs are actually supplying services or exporting. As per the GST framework, an 18% tax has to be levied if it is not an export.

The Gujarat High Court in July had held that supply of services by intermediaries outside India is not export and that 18% GST should be levied on that. That meant that these entities will have to cough up 18% additional GST, like any other domestic companies on such services provided to service recipient based outside India.

Many BPOs had requested the high court to review its stand. The court is now planning to accept the review petitions.

 

Source: The Economic Times