Taxable person GST: Analysis by CA Manoj Gupta

Let’s understand the Taxable person GST

1. As per section 7 of MGL it is the taxable person who is liable to pay CGST and SGST.

2. Taxable person means any person [Person is defined in section 2(74) and includes all forms of carrying on of business] who carries on any business in India/ State of ….. and who is registered and required to be registered under Schedule III to MGL.

3. The Central Government, a State Government or any local authority shall be regarded as a taxable person in respect of activities or transactions in which they are engaged as public authorities other than the activities or transactions as specified in Schedule IV to MGL.

4. Persons not to be considered as taxable person under MGL

A. Any person who provides services as an employee to his employer in the course of, or in relation to his employment, or by any other legal ties creating the relationship of employer and employee as regards working conditions, remunerations and employer’s liability

B. Any person engaged in the business of exclusively supplying goods and/or services that are not liable to tax under MGL

C. Any person, liable to pay tax under reverse charge, receiving services of value not exceeding specified amount in a year for personal use, other than for use in the course or furtherance of his business

D. An agriculturist

E. Every supplier in the State from where he makes a taxable supply of goods and/or services if his aggregate turnover in a financial year does not exceed the specified limit [ Which is proposed to 20 lakhs for all states and 10 lakhs for NE states including Sikkim]

5. Issues arising
A. An agriculturist is not to be treated as taxable person. As per section 2(8) “agriculturist” means a person who cultivates land personally, for the purpose of agriculture. What if one carries on business and also being an agriculturist. Will such person not be taxable person so far as business is concerned.
B. Every supplier will not be a taxable person till his turnover exceeds Rs 20 lakhs in a financial year. That means every year upto 20 lakhs no GST will be payable. Currently under Excise and service tax the liability to pay tax is calculated on basis of turnover of last year.

Hope this helps you understand more about the Taxable person GST.

Compiled by
CA Manoj Gupta
Jodhpur
9828510543
gm2104@gmail.com
© CA Manoj Gupta