Classification and GST rate on lottery tickets, unstitched salwar fabrics, Terracotta idols

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Classification and GST rate on lottery tickets, unstitched salwar fabrics, Terracotta idols. check out latest amendments for gst rates on unstitched salwar fabrics & Terracotta idols.

Classification and GST rate on lottery tickets

Supply of lottery has been treated as supply of goods under the CGST) Act, 2017. However, the code allotted for GST rate was specified under services. As a result, the assessees were not able to upload their return or deposit tax in time.

Accordingly, Circular no. 6/6/2017-CGST dated 27th August 2017 was issued to clarify the above issue. It was stated that the process of filing return is linked with rate of tax specified for supply. Further, there is complete clarity about rate of tax on lotteries. In GST, lottery is goods and the classification indicated in relevant notification for lottery is “-”, which means any chapter.

Thereby, it was clarified that the classification for lottery in respective CGST, IGST, UTGST and SGST notifications shall be ‘Any Chapter’ of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) and tax on lottery should be paid accordingly at prescribed rates, 12% or 28%, as the case may be.

Classification of unstitched salwar fabrics

Before becoming readymade articles or an apparel, fabric is cut from bundles or thans and sold in that unstitched state. The consumers buy these sets or pieces and get it stitched to their shape and size.

Fabrics are classifiable under chapters 50 to 55 of the First Schedule to the Customs Tariff Act, 1975 on the basis of their constituent materials and attract a uniform GST rate of 5% with no refund of the unutilized input tax credit.

Mere cutting and packing of fabrics into pieces of different lengths from bundles or thans, will not change the nature of these goods and such pieces of fabrics would continue to be classifiable under the respective heading as the fabric and attract the 5% GST rate.

This was clarified vide Circular no. 13/13/2017-GST dated 27th October 2017.

Classification and GST rate on Terracotta idols

As terracotta is clay based, terracotta idols will be eligible for Nil rate under Sl. No.135A of notification 2/2017 dated 28.06.2017. This has been clarified vide Circular no. 20/20/2017- IGST dated 22nd November 2017.

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