In a move to promote and streamline skill development initiatives across the country, the Central Board of Indirect Taxes and Customs (CBIC) issued Notification No. 08/2024 – Central Tax (Rate) on October 8, 2024. This notification amends the existing GST structure by exempting certain services related to skill development from GST.
The decision to provide this exemption comes following the recommendations of the GST Council during its recent meetings, where the importance of reducing tax burdens on skill development initiatives was emphasized. These exemptions aim to facilitate greater access to vocational training and skill certification programs by making them more affordable.
Key Changes Introduced by Notification No. 08/2024
The new notification makes significant changes to Notification No. 12/2017 – Central Tax (Rate) dated June 28, 2017, by replacing the existing provisions under Serial No. 69 with a new set of exemptions for services provided by recognized skill development bodies.
Updated Entry for Serial No. 69
The notification revises the exemptions under Serial No. 69 in the following manner:
| Serial No. | Service Heading | Description of Service | GST Rate | Conditions |
|---|---|---|---|---|
| 69 | Heading 9983, 9991, 9992 | Services provided by: (a) National Skill Development Corporation (NSDC) (b) National Council for Vocational Education and Training (NCVET) (c) Recognized Awarding Bodies (d) Recognized Assessment Agencies (e) Accredited Training Bodies working with recognized awarding bodies, related to: (i) National Skill Development Programs (ii) Vocational skill development courses under the National Skill Certification and Monetary Reward Scheme (iii) Any National Skill Qualification Framework (NSQF) aligned qualification or skill, as approved by NCVET. | Nil | Nil |
This change ensures that services related to skill development, provided by accredited bodies or institutions recognized by the National Skill Development Corporation (NSDC) and the National Council for Vocational Education and Training (NCVET), are exempt from GST.
Updated Terminology: NCVT to NCVET
In addition to the changes under Serial No. 69, the notification also updates terminology to reflect recent reforms in vocational education and training governance. Specifically, the term “National Council for Vocational Training (NCVT)” has been replaced with “National Council for Vocational Education and Training (NCVET)” in several related provisions across the notification.
The updated terminology ensures consistency with the National Education Policy (NEP) 2020 and the reforms introduced in vocational and skill-based education in India. This change is reflected in:
- Serial No. 71: All references to the NCVT are updated to NCVET in column (3).
- Paragraph 2: Sub-items (i) and (ii) have been updated to replace references to NCVT with NCVET.
Objective of the Amendment
The primary objective of the amendment is to encourage and support skill development by reducing the tax burden on organizations providing vocational training. By exempting these services from GST, the government aims to:
- Enhance Access: Lower the cost of skill development courses, making them more accessible to a broader section of the population.
- Promote Vocational Training: Encourage more individuals and institutions to participate in skill development programs aligned with the National Skill Qualification Framework (NSQF).
- Streamline Certification: Support the National Skill Certification and Monetary Reward Scheme, further incentivizing individuals to pursue skill-based qualifications.
Effective Date
The amendments introduced by Notification No. 08/2024 will come into effect from October 10, 2024.
Implications for Skill Development Bodies
The exemption from GST is applicable to various entities involved in skill development, including:
- National Skill Development Corporation (NSDC): A key player in implementing skill development programs and working closely with the Ministry of Skill Development and Entrepreneurship (MSDE).
- National Council for Vocational Education and Training (NCVET): The regulatory body overseeing vocational training programs and setting standards for skill development in India.
- Awarding Bodies and Assessment Agencies: Entities recognized by NCVET for providing qualifications and conducting assessments for various vocational skills.
- Training Bodies: Accredited institutions working in collaboration with NSDC and NCVET to deliver skill training across sectors.
With this notification, the government reiterates its commitment to enhancing vocational training and skill development in India. By exempting key services from GST, the amendment not only reduces the cost of delivering skill-based education but also aligns with the broader national agenda of creating a skilled workforce.
Skill development organizations, training bodies, and vocational institutes should review the updated provisions to ensure compliance and take advantage of the GST exemptions starting from October 10, 2024.
This article provides a detailed overview of the changes brought by Notification No. 08/2024 and explains its implications for stakeholders involved in skill development.
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