The GST has been very significant reform upcoming in India as it is seen by very positive eyes because it will be a business uplifting scheme after the Independence and certainly a page turner. Another term (MGL) Model GST Law has been studied and has been taken into the consideration in the context of Employer and Employees relation.
The current situation law forms have been analyzed and waited for further changes after the application of new taxation reform. The provisions of section 65B(44) of the Finance Act, the term service as called to serve the employer within the relation of both parties in consideration of remuneration, is an activity which is not taxable and not subjected to taxation.
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There has been always up looking for the taxation clause on the service of an employee under the GST, so the changes are surely possible under the Model GST Law.
After acknowledging the Chapter 3 of MGL, which shows the GST implication, “Taxable person” is understood as in Section 9, to mean a person who carries on any business at any place in India and who is registered or required to be registered. As per section 9(3)(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, shall not be considered as a taxable person.
There another hint of some clause and its changes implied can be focused under the section 9(3)(a), which covers service of an employee through any other legal ties creating the relationship of employer-employee as regards working conditions, remuneration and employer’s liability. Such employee would also not be treated as a taxable person.
By now so far, there has been confusion on the taxation of this particular category and it will be appreciated if the government take some necessary step in this dilemma whether to tax or not such transactions. The MGL is in the middle of drafting stage and hopes to get completed soon leaving no trace of doubtfulness.
