NEW DELHI: The staffing industry has reached out to the GST ( Goods and Services Tax ) Council to seek ITC (input tax credit) on insurance services procured for its employees.
Modi, who is a member of the panel on MSME relief, said the GoM was unanimous that the exemption limit for the MSMEs which are supplier of goods should be increased but there was no unanimity among states. Hence, it was left to the GST Council to decide.
While Delhi state govt. suggested that the limit should be hiked to turnover of up to Rs 40 lakh, Bihar govt. suggested it at Rs 50 lakh.
“We had a meeting with GST Council and have sought them to either clarify or amend the Act to remove ambiguity with regard to availability of input tax credit on insurance charges incurred on employees,” Suchita Dutta, executive director of the Indian Staffing Federation (ISF), told one news agency.
The industry expert says the advantage will give support it to offer better social security package to workers while also reducing their cost of doing business.
Indian Staffing Federation said since insurance services are used by staffing business in the course of furtherance of its outward supply of manpower services, it should be eligible for ITC(input tax credit).
“Allow input tax credit of GST paid with respect to health, medical, accidental and life insurance coverage for employees or notify insurance procured for employees as eligible for input tax credit with retrospective effect,” ISF said in its submission to the council on September 25