GST, or Goods and Services Tax, is an indirect tax system in India. Supposedly, GST is a better taxation policy than the previous ones. If only we could understand it better, could we agree more!
To better understand, let’s take an example of Alpha, Beta, Charlie. All three are either household shifting or shifting an office. Alpha is a new graduate. He is shifting near an IT park to find a job. Beta is a well-established doctor, happily married with two kids. He is home shifting near a Super specialty hospital, where he is appointed as the new Chief. Charlie, a florist is an entrepreneur and needs to deliver utilities to a wedding reception. All three have decided to avail of the shifting services of Delta Packing Company.
Important GST terminologies
GTA – Goods transport agency
Any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name it is called.
GST law defines GTA in notification no. 12/2017-Central Tax (Rate) dated 28.06.2017
Consignment Note
Document prepared by a consignor and countersigned by the carrier as a proof of receipt of consignment for delivery at the destination.
Business Dictionary
Consignment note is an essential condition to be a GTA under GST. For example, here Delta Packing Company is the GTA.
Alpha is only opting for its transportation services. He is packing, loading, and unloading by himself. But, Beta, having a lot to pack is availing the services of the professional packers and movers. Hence, the staff is responsible for packing, loading, unloading, and unpacking. Charlie also just needs a transport vehicle for the local shifting services. Now, let’s see how the Packers Company charges GST to these individuals.
- Alpha – 5% of the bill.
- Beta – 18% of the bill
- Charlie – 5% of the bill
Here, Alpha and Charlie are transporting two different kinds of items, one is household shifting while the other is cargo. However, both come under the 5% slab, since they both need only transportation services(i.e., a truck and a driver). Beta, on the other hand, requires multiple labors and transportation. Therefore, he is paying 18% including all services.
To sum up, GST for packers and mover is a vast ocean. Here, we have explained just a few drops, to bring clarity in billing. Get free quotations today.
Happy moving!