GST - Intermediary

[Madhavan iyengar]

dear all readers and experts

Please share views on circular issued on intermediary services 18/07/2019 107/26/2019-GST

i am putting down some points so that it can be taken forward by panel

5.2 scenario -II does this mean a manufacturer in India who exports goods and for this purpose if he engages a logistic company and all transportation services are undertaken by the manufacturer through the logistic company in India from factory to port and onwards till destination say Brazil and when he invoices for goods he includes all costs and exports them

in above scenario will the manufacturer exporter be called as intermediary for the logistic services performed through logistic company for export from India till brazil and thus be liable for tax on the services

AI Summary

Manufacturer-Exporter Using Logistics Not 'Intermediary' Under GST; Supplies on Own Account Per Section Definition A user inquired whether a manufacturer-exporter in India, who uses a logistics company for exporting goods and includes all related costs in the invoice, would be considered an 'intermediary' under GST law. The response clarified that the manufacturer-exporter is not an intermediary because the definition excludes those who supply goods or services on their own account. An intermediary only facilitates or arranges services and earns a commission, not additional charges. The distinction between supplying on one's own account and acting as an intermediary is crucial, and the GST definition aligns with previous service tax definitions.