GST Council rationalizes taxation on print at 5 August 2017 meeting

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GST Council rationalizes taxation on print at 5 August 2017 meeting

The Government of India’s GST Council met for the 20th time on Saturday 5 August 2017 and revised the rates on thirteen categories including job work services for textiles; services for printing of newspapers and books (including Braille books) where content is from the publisher and the physical inputs for printing are from the printer; works contract services provided by government; commission to fair price dealers by government; admission to planetariums; rent-a-cab services, ground transport agency services; and, tractor parts. The GST for turnkey printing work was also revised.

Significant for the newspaper, magazine and book publishing and printing industry, is the reduction in GST for printing services for publishers from 18% with full Input Tax Credit (ITC) to 5% GST with full ITC where the publisher supplies inputs such as paper. For turnkey printing services in which the printers supplies the paper and other inputs, the GST has been reduced from 18% with full ITC to 12% with full ITC.

In the opinion of at least one commercial printer in Delhi, this seems to be a satisfactory revision of the anomalous rates that were earlier announced. The previously confusing and anomalous rates and were discussed by a delegation of the All India Master Printers Association with the relevant TRU committees of the Ministry of Finance a few days earlier.

What is CGST, SGST, IGST
The GST to be levied by the Centre is called Central GST (CGST) and that to be levied by the States (including Union territories with legislature) would be called State GST (SGST). An Integrated GST (IGST) would be levied on inter-State supply (including stock transfers) of goods or services. This would be collected by the Centre. Import of goods would be treated as inter-State supplies and would be subject to IGST in addition to the applicable customs duties. Exports will be treated as zero-rated supplies which means no tax will be payable on exports of goods or services. However, exporters can claim input tax credit (ITC).

2023 promises an interesting ride for print in India

Indian Printer and Publisher founded in 1979 is the oldest B2B trade publication in the multi-platform and multi-channel IPPGroup. While the print and packaging industries have been resilient in the past 33 months since the pandemic lockdown of 25 March 2020, the commercial printing and newspaper industries have yet to recover their pre-Covid trajectory.

The fragmented commercial printing industry faces substantial challenges as does the newspaper industry. While digital short-run printing and the signage industry seem to be recovering a bit faster, ultimately their growth will also be moderated by the progress of the overall economy. On the other hand book printing exports are doing well but they too face several supply-chain and logistics challenges.

The price of publication papers including newsprint has been high in the past year while availability is diminished by several mills shutting down their publication paper and newsprint machines in the past four years. Indian paper mills are also exporting many types of paper and have raised prices for Indian printers. To some extent, this has helped in the recovery of the digital printing industry with its on-demand short-run and low-wastage paradigm.

Ultimately digital print and other digital channels will help print grow in a country where we are still far behind in our paper and print consumption and where digital is a leapfrog technology that will only increase the demand for print in the foreseeable future. For instance, there is no alternative to a rise in textbook consumption but this segment will only reach normality in the next financial year beginning on 1 April 2023.

Thus while the new normal is a moving target and many commercial printers look to diversification, we believe that our target audiences may shift and change. Like them, we will also have to adapt with agility to keep up with their business and technical information needs.

Our 2023 media kit is ready, and it is the right time to take stock and reconnect with your potential markets and customers. Print is the glue for the growth of liberal education, new industry, and an emerging economy. We seek your participation in what promises to be an interesting ride.

– Naresh Khanna

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