GST

Annual boarding and lodging for hostellers GST free: Ministry of Finance

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Clarifying the confusions pertaining to the Goods and Services Tax (GST), Ministry of Finance has said that there will be no GST on annual subscription/fees charged as lodging/boarding charges by educational institutions from its students for hostel accommodation.

The official communiqué further stated that services provided by an educational institution to students, faculty and staff are fully exempt from the GST.

“There are some reports that 18 percent GST will be levied on annual subscription/fees charged for lodging in hostels. This is not true. There is no change in tax liability relating to education and related services in the GST era, except reduction in tax rate on certain items of education,” it said.

“It may be mentioned that services provided by an educational institution to students, faculty and staff are fully exempted.”

In its communication, the Ministry of Finance defined educational institutions as a place imparting:

(i) Pre-school education and education up to higher secondary school or equivalent;

(ii) Education as a part of a curriculum for obtaining a qualification recognised by any law for the time being in force;

(iii) Education as a part of an approved vocational education course.

“Services of lodging/boarding in hostels provided by such educational institutions which are providing pre-school education and education up to higher secondary school or equivalent or education leading to a qualification recognised by law, are fully exempt from GST,” it added.

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