VATupdate

No GST on back-office sector, says govt in intermediary services dispute

The government has said services outsourced to India and those provided domestically for foreign entities will not be treated as intermediary services, enabling them not to pay the 18% Goods and Services Tax (GST), said the Economic Times on Tuesday about a policy decision that strengthens the country’s back office industry. The Central Board of Indirect Taxes and Customs (CBIC)’s clarification on the scope of intermediary services will ensure that exports of R&D in software, business process management and IT services are not denied ‘export status’.

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