Service by gta to gta

[Shahnawaz Alam]

A registered truck owners having 5-10 trucks having attached their trucks with GTA (providing logistics services to corporate and charging 12% GST) are raising tax invoices and charging GST @ 12% on transportation bill with claiming input of Vehicle and expenses. Is this correct or wrong?

[Ganeshan Kalyani]

In my view, 18% GST would be applicable.

[KASTURI SETHI]

In this case, two services are involved. (i) Hiring of truck by GTA (ii) GTA is supplying service of transportation of goods by road to corporate body. Such GTA is working under FCM and not under RCM.

Hiring of truck is exempted.

[KASTURI SETHI]

Also see the decision of AAR, Karnataka reported as 2020 (1) TMI 572/AAR/Karnataka

Applicant :Saravana Perumal

Date of decision 27.12.19.

AI Summary

Debate Over Correct GST Rate for Truck Owners: 12% or 18%? Clarification on Exemptions and Charge Mechanisms. A discussion on Goods and Services Tax (GST) involves a query about the correct GST rate for truck owners providing logistics services through a Goods Transport Agency (GTA). The initial question concerns whether charging 12% GST on transportation bills is appropriate. One response suggests an 18% GST rate may apply, while another clarifies that two services are involved: truck hiring, which is exempt, and transportation services, which are under the Forward Charge Mechanism (FCM) rather than the Reverse Charge Mechanism (RCM). A reference to a decision by the Authority for Advance Rulings (AAR) in Karnataka is also mentioned.