ECO providing bus transportation services to be excluded from purview of section 9(5) of GST

The 52nd meeting of the GST Council was chaired by Union Finance Minister Nirmala Sitharaman in Sushma Swaraj Bhawan, New Delhi, today i.e 7th October 2023.

Along with the Union Finance Minister, Union Minister of State for Finance Shri. Pankaj Chaudhary, Chief Ministers of Goa and Meghalaya, besides Finance Ministers of States & UTs (with legislature) and Senior officers from Union Government and States also attended the meeting.

With effect from 1st January 2022, liability to pay GST on bus transportation services supplied through Electronic Commerce Operators (ECOs) has been placed on the ECO under section 9(5) of CGST Act, 2017.

This trade facilitation measure was taken on the representation of industry association that most of the bus operators supplying service through ECO owned one or two buses and were not in a position to take registration and meet GST compliances.

To arrive at a balance between the need of small operators for ease of doing business and the need of large organized players to take ITC, GST Council has recommended that bus operators organised as companies may be excluded from the purview of section 9(5) of CGST Act, 2017.

This would enable them to pay GST on their supplies using their ITC.