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Decision of GST Council
The Kerala Finance Minister Thomas Isaac had come up with the idea of levying cess to fund flood relief work. According to the recommendation of the 32nd GST Council meeting, which held in New Delhi 10.01.2019, the cess can be imposed for sales within the Kerala State for a period of two years. As per GST norms, a special levy can be imposed for a specified period to raise additional resources to cope up with the losses of any natural disaster.
Kerala Flood cess
Clause 14(1) of the Kerala Finance Bill, 2019 provides that there shall be levied a cess called the Kerala Flood Cess on such intra-State supplies of goods or services or both made by a taxable person as provided for in section 9 of the Kerala State Goods and Services Tax Act, 2017 and collected in such manner, as may be prescribed, for the purposes of providing reconstruction, rehabilitation and compensation needs which had arisen due to the massive flood which occurred in the State of Kerala in the month of August, 2018 for a period of two years, with effect from the date notified by the Government in the Official Gazette.
Exemption for levy of cess
The Kerala Flood Cess is not leviable on-
- supplies made by a taxable person who has decided to opt for composition levy under section 10 of the Kerala State Goods and Services Tax Act, 2017;
- supplies of goods and services or both exempted by notifications issued under section 11 of the Kerala State Goods and Services Tax Act, 2017;
- supplies of goods and services or both made by a registered taxable person to another registered taxable person.
Kerala Flood Cess Rules
The Kerala Government, in exercise of the powers conferred on it under clause 14(1) of the Finance Bill, 2019 made the ‘Kerala Flood Cess Rules, 2019’.
Effective date
This rule will come into effect from 01.06.2019.
Levy and collection
Kerala Flood Cess shall be levied on intra-state supplies of goods or services or both made by a taxable person to an unregistered person in respect of supplies specified in the TABLE under sub-clause (2) of clause 14 of the Kerala Finance Bill, 2019 as detailed below-
Sl.No. | Description of goods or services or both | Rate of cess |
(1) | (2) | (3) |
1 | Supplies of goods for which tax rate is fixed at 0.125 % by notification issued under sub-section(1) of section 9 of the Kerala State Goods and Services Tax Act, 2017 | NIL |
2 | Supplies of goods for which tax rate is fixed at 1.5 % by notification issued under sub-section (l) of section 9 of the Kerala State Goods and Services Tax Act, 2017 | 0.25% |
3 | Supplies of goods for which tax rate is fixed at 2.5 % by notification issued under sub-section (1) of section 9 of the Kerala State Goods and Services Tax Act, 2017 | NIL |
4 | Supplies of services for which tax rate is fixed at 2.5 % by notification issued under sub-section (1) of section 9 of the Kerala State Goods and Services Tax Act, 2017 | 1% |
5 | Supplies of goods and services or both for which tax rate is fixed at 6%, 9% and 14% by notifications issued under sub-section (1) of section 9 of the Kerala State Goods and Services Tax Act, 2017. | 1% |
Kerala Flood Cess shall be collectable on the taxable value of supplies specified in the table below-
PARTICULARS OF KERALA FLOOD CESS PAYABLE
Sl. No. | Category of supply | Total value of intra-State B2C supply | Rate of Kerala Flood Cess on value of supply | Kerala flood cess payable |
1 | Goods taxable at the rate of 1.5% SGST |
| 0.25% |
|
2 | Goods taxable at the rate of 6% SGST |
| 1% |
|
3 | Goods taxable at the rate of 9% SGST |
| 1% |
|
4 | Goods taxable at the rate of 14% SGST |
| 1% |
|
5 | All Services under SGST |
| 1% |
|
| Total |
|
|
|
Invoice
The Kerala Flood Cess collected shall be shown separately in the invoice.
Payment
The Kerala Flood Cess shall be paid over to the Government along with the return.
Return
- The taxable person shall file monthly return on the Kerala Flood Cess levied. Every taxable person liable to pay the Kerala Flood Cess shall file a monthly return in Form No. KFC-A On or before the due date for filing of GSTR-3B return, specified under rule 61 of the Kerala Goods and Services Tax Rules, 2017.
- The return shall be filed electronically through the official portal 'www.keralataxes.gov.in' and e-payment of Kerala Flood Cess due shall be made along with such return.
- In order to e-file cess return and payment of cess, one time ‘user ID and password’ shall be generated from the portal.
- The details of outward supplies of goods or services or both, attracting the Kerala Flood Cess made to unregistered persons shall be mentioned in the return.
- The details of outward supplies of goods or services or both, shall match with the corresponding details of outward supply of goods or services or both as per GSTR-1.
- The following particulars are to be furnished in the return-
- GST Circle;
- Date of the return;
- GSTIN;
- Legal name of business;
- Trade name;
- Constitution of business;
- Particulars of Kerala Flood Cess payable;
- Taxpayer type;
- Composition opted – No
- Return period
- Jurisdiction – State/Centre.
Refund
There shall be no refund of the Kerala Flood Cess paid along with the returns.
Applicability of Acts and rules
The provisions of the Kerala State Goods and Services Tax Act, 2017 and Central Goods and Services Tax Act, 2017 and the rules made there under, including those relating to definitions, authorities, assessment, audits, non-levy, non-filing of return, short-levy, interest, appeals, recovery of tax, offences and penalties, shall, as far as may be, mutatis mutandis, apply, in relation to the levy and collection of cess leviable under sub-rule (1) of rule 2, as they apply in relation to the levy and collection of tax on the intra-state supplies under the said Act or the rules made there under.