GST@ 12% ON JOBWORK AGAINST 20/2019- Central Tax (Rate)

[RSundaram RAMASAMY]

Dear All,

We are doing job work activities to aviation customers for the Mfr of Rubber product & Metal Product. Now we charged GST @ 18%. and Using SAC Code 9988 [ (ii) Manufacturing services on physical inputs (goods) owned by others, other than (i) above.]

As per Not.No. 20/2019- Central Tax (Rate), GST rate will be change @ 12%.

Kindly suggest us, can we implement GST @ 12 % for further job work activities for rubber product and metal product ?

Thanks

AI Summary

Job work taxation: treatment of goods belonging to registered principals attracts lower GST rate while manufacture-like processes attract higher rate.
Whether a treatment or process on goods belonging to a registered principal is classified as job work or as manufacture determines the applicable GST rate: treatment/process on goods of a registered principal that remains within the scope of job work is treated under SAC 9988 and attracts the lower job-work rate, while operations that result in a new, marketable product amounting to manufacture may be treated as manufacturing service and taxed at a higher rate; Board Circular No. 38/12/2018 permits use of own inputs by job workers and a later CBIC circular is reported to confirm lower treatment for job work on goods of registered persons.