It has been decided to levy Goods & Services Tax (GST) in place of service tax including Cess on transportation of Parcel traffic (leased or non-leased) by rail.
The detailed procedure for levy of GST on transportation of parcel traffic by rail shall be as under:-
Goods and Service tax (GST) will be levied for transportation of all description of parcel traffic (leased or non-leased parcel traffic) and merchandise items (for commercial use) booked as luggage.
Luggage traffic i.e. personal baggage belonging to the travelling passengers, (Excluding merchandise items for commercial use), shall be exempted from GST. The details of other commodities exempted from GST shall be as under:-
(i) Relief materials meant for victims of natural or man-made disasters, calamities, accidents or mishap
(ii) Defence of military equipments
(iii) Newspaper or magazines registered with the Registrar of Newspapers
(iv) Railway equipments or materials
(v) Agricultural produce
(vi) Milk, salt and food grain including flours, pulses and rice
(vii) Organic manure
The rate of GST shall be 5% on total freight. (in place of 4.5% service tax levied earlier- an increase of 0.5% only)
Goods & Services Tax will be levied on the total freight as reflected in the Parcel Way Bill and /or Luggage ticket and /or Money receipt (in case of leased traffic) issued on or after 01.07.2017 and it will be collected at the time of booking and preparation of Parcel Way Bill/Luggage ticket/Money receipt.