19 Jul , 2022 By : Monika Singh
Entities dealing in the securities market will need to pay a GST of 18% on the fees charged by the Securities and Exchange Board of India (Sebi). The new tax rate is effective from Monday, the market regulator said in a circular.
The GST Council in its meeting held on June 28 and June 29 had
recommended withdrawal of exemption granted to services rendered by Sebi and the same was notified on Monday. “Accordingly, all the market infrastructure institutions, companies that have listed or intending to list their securities, other intermediaries and persons who are dealing in the securities market, are hereby informed that the fees and other charges payable to Sebi shall be subject to GST at the rate of 18% with effect from July 18, 2022,” the regulator said.
This would result in additional costs for companies and lead to cash flow issues for some. Companies from certain sectors may not even be able to take the benefit of input tax credit on this,” said Yashesh Ashar, partner, Bhuta Shah & Co.
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