Key Highlights of Notification No. 4/2024–Central Tax (Rate)

Simplified Explanation of Notification No. 4/2024–Central Tax (Rate)

**1. Notification Overview:

This notification updates the rules related to GST exemptions for certain services. It amends the existing notification (No. 12/2017-Central Tax (Rate)) which details which services are exempt from GST.

**2. Key Changes in the Notification:

**A. New Exempt Services for Indian Railways:

• Services Provided by Indian Railways to Individuals:
  • Examples: Sale of platform tickets, facility of retiring/waiting rooms, cloak room services, and battery-operated car services.
  • GST Rate:Nil (No GST)
• Services Between Railway Zones/Divisions:
  • Example: Services provided by one railway zone to another zone within the Indian Railways.
  • GST Rate:Nil (No GST)
• Services Provided by Special Purpose Vehicles (SPVs) to Indian Railways:
  • Example: Infrastructure use by Indian Railways during a concession period and maintenance services related to that infrastructure.
  • GST Rate:Nil (No GST)

**B. Amendment to Accommodation Services Exemption:

• Changes to Existing Explanation:
  • Removal: The words “Heading 9963 or” are removed from the notification.
  • New Explanation Added:
    • Explanation 2: Excludes accommodation services for students in student residences and similar accommodations (hostels, camps, paying guest accommodations) from the GST exemption.

**C. New Exemption for Accommodation Services:

• Accommodation Services with Value Less Than or Equal to ₹20,000:
  • Example: If the accommodation service costs ₹20,000 or less per person per month and is provided for a continuous period of at least 90 days, it will be exempt from GST.
  • GST Rate:Nil (No GST)

**3. Effective Date:

• These changes come into effect on July 15, 2024.

**4. Examples:

• Example 1: Indian Railways Services:
  • If you purchase a platform ticket from Indian Railways or use a cloak room service, you will not be charged GST starting from July 15, 2024.
• Example 2: Accommodation Services:
  • If you stay in a rental accommodation that costs ₹18,000 per month for more than 90 days, this service will be exempt from GST.
• Example 3: Excluded Services:
  • If you stay in a hostel or a student residence, this accommodation service will not be exempt under the new rules; it will be subject to GST.

Summary:

• New Exemptions: Indian Railways services and certain accommodation services.
• Amendments: Clarifications on what types of accommodation services are not exempt.
• Effective Date: July 15, 2024

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