Goods and Services Tax (GST) is been on news lately and articles mainly talked about all the major and common sectors that will take its impact for goods and in this article, we focused on the influence of GST on educational sector and wherewith response of curriculum related or course materials on top e-commerce sites like Flipkart and Amazon.
India is a country that is focalised its one of the goals to provide a quality education to everyone at low cost but there are many education services which questions -should they be paying tax or in other words should they come under GST, for example, private tuition centers.
It seems GST will be tapping every sector of the economy to help to build a strong economy for the country by means of rendering a single tax regime. Goods and Services Tax (GST) is an indirect tax reformation which aims to eliminate tax barriers between states and create a single market.
In the present scenario, education is provided by the public sector, private sector and also by distance education; so which services they provide should come under GST? It is true that education provided by the government institutions will not be taxable and they may give exception to private higher secondary schools but still, taxes customed on coaching centers and training institutes can resolute hardship on students and their parents who believe in taking all the necessary precautions to get a good results on the marks sheet. If they think outside the box and think of buying necessary materials from online stores then what they may have to pay there?
To understand that, first we have to know about E-commerce industry which currently valued at $30 billion and predicted to reach a massive market value of $100 billion by the year 2020 and there is no need to tell 'Education Sector' is also one of its biggest parts.
To think of Education Sector, India has more than 1.4 million schools and more than 36,000 higher education institutes where most of the students directly or indirectly brought educational materials from online sites or vendors and no need to emphasize after secondary education, the youth of the country is well aware of the e-commerce site such as Amazon and Flipkart which offers educational materials of their need and deliver it to their doorstep.
And students education may additionally require items such as musical instrument, computers, sports equipment, uniforms, stationery, and other non-academic related supplies, curriculum or syllabus related or course materials to give them the vision they need to build their future; which can be brought online but there will be price raised for these materials.
On the other side, a good news is that it is predicted that education services provided by the institute to the students and faculty, transportation services, catering, mid-day meals, security, cleaning, may remain GST free.
So that GST must not be a burden on an ethical structure of the developing country education sector most likely will be taxed at the lowest slab of 5% and also along with the healthcare industry, the education industry demands to be kept at minimum tax maybe with the conditions applied. Conclusively, GST may give secondary shocks but on a bird view, GST has a no bigger impact.