How Does The GST Rules Effect The Education Sector?

February 14th, 2018 | by Mack A
How Does The GST Rules Effect The Education Sector?

The education sector in India, as an uncompromising factor, is the fundamental requirement for the growth of the society. Whether it is a private or government school, both hold an equal amount of importance in the rise of the educated people in India since past few decades. We all know what our history was. And we also are well aware of the fact that landing on the surface of opportunities was not done overnight. The act of getting people of the nation free following the launch of the constitution of India required a strenuous effort that could not be explained in words yet the results are visible. And the fact that we proudly call ourselves democratic is a testimony of the hard work done in the past.

Now you cannot really understand what being democratic really is if you are not educated. Thus education is important, not only to understand the concept of democracy but also to identify the available opportunities and use them to better yourself and ultimately, the nation as well. Although, the implementation of the new tax regime in India has built a bridge that fundamentally merges the education with the taxation and creates an effect. Moving on further, we’ll bring the contrast on the GST effects on education, that whether they are positive or negative.

The Effect

The Indian government has always seen the education sector as an important asset where the future of the nation lies. That is why, the education sector, as of always, enjoys a considerable exemption from the hassles of taxation, thus having an easier functioning structure for the teachers as well as the parents. Post implementation, the education sector has been relieved from the GST. Here are the impacts that the new tax regime made on the education/higher education in India:

  1. The education from pre-school to higher secondary classes or any equivalent education is exempted from the GST regime.
  2. Any law recognized education that is centered to provide qualification and also maintains a specific curriculum to conduct and operate, is exempted from the GST regime.
  3. Any vocational course that provides education and is also approved by the government in the terms of being authentic, is exempted from the GST regime.

As it is a clear fact that the education is not only about the students, the government has also exempted the services related to education as per the India GST rules. Here is the list:

  1. The course material related to the education.
  2. Any sort of examination is fees is exempted.
  3. The payments of fees like registration, late fee, academic transcript, id-card etc. are exempted from the list of the Goods and Services Tax.
  4. Any field trip required as per the curriculum of the education.
  5. The services that are provided to the students and teachers like transportation, security, cleaning, admission conduction etc. are exempted from the new tax regime.

Some of the education provided by the institutions are also exempted from the GST regime when it comes to India’s GST exemption for small business.

  1. The government approved and set up National Skill Development Corporation is exempted from the list.
  2. The councils approved by the National Skill Development Corporation are exempted.
  3. The assessment agencies approved by National Skill Development Corporation are exempted.
  4. The NSDC approved skill development programs are also on the exemption list.
  5. Any scheme partnered with the external agency by the NSDC is exempted.

Although, the education is important, there are various other things that are associated with the education sector and cannot be relieved from the GST regime. These services are:

  1. The third party supplies to school for educational purposes like sports equipment, computer etc. are levied to the taxation.
  2. The school’s uniform and stationary are also under the effect of the GST regime.
  3. The education via private institutions are on the list of GST and are levied to 18% tax.
  4. The coaching institutes, operating privately are not exempted from the GST regime and are levied to the tax of 18%. This will create an effect on the pockets of the exam aspirants as they have to pay more to prepare.


While the basic requirements of the services in the education sector are kept GST-free by the government, the education in the private institutes will see a slight rise in the prices. But, if the effects of the Goods and Services Tax on other aspects of businesses are taken into account, then it could be easily comprehended that the education sector is still in a big relief with minor tax implications that were necessary anyway as they involve external services. Hence, the government has kept the education intact and engaging, thus ensuring a brighter future for the nation.