Taxes and Duties

With the enhancement of modern-day technology, information data is now accessible at the touch of a button all over the world. Gone are the times when authors had to bury themselves in copious amounts of paper to stay competitive. Information is now everywhere, accessible to practically anyone with electronic devices like smartphones, desktops, and other instruments. However, the current web pattern has harmed the publication and printing houses industries.

Goods & Services Tax

The popularity of e-books has been increasing rapidly, while the publishing business is struggling to stay up front. From July 1, 2017, the Goods and Services Tax (hereafter referred to as ‘GST’) went into effect. GST is an inter-stage, destination-based tax levied on each value-adding stage of the manufacturing process. The GST regime imposes a tax throughout every phase of the sale. The GST has eliminated the formerly relevant spiraling tax effect.

How is the GST amount decided?

The following rules will govern whether or not additional GST will apply to the products purchased by you:
GST amount: If applicable, the amount of GST collected from the customer depends on the category

Rates of GST on Books

The GST rate for books exists in HSN code chapter 49. In a meeting conducted on May 18, 2017, the GST committee voted on the GST rates for products and services, with GST introduced in India on July 1, 2017. The GST rate for the book is examined in-depth here.

GST is not applicable on:

  • Printed books, notably braille books and newspapers, as well as publications, calendars, atlases, charts, and globes, are all exempt from GST.
  • Brochures are subject to the GST rate:
  • Brochures, booklets, and other print materials are subject to the 5% GST rate, whether on individual pages or not.

The GST rate is 12% for:

  • Graphic, sketching, or picture books for kids.
  • Music, whether printed or in a script, bound or unbound, with or without illustrations.
  • Other hard copies, newspapers, photos, and other printing sector products, as well as scripts, typescripts, and plans, are taxed at a rate of 12% GST.

Some of the things taxed at 12% GST include:

  • Stamp imprinted material; currencies; cheque forms; share, stock, or bond papers and equivalent documents of title; unsold postage, income, or similar tokens of existing or future issue in that they have, or will have, an acknowledged face rate.
  • Original piece manufacturing, economic, geographical, architectural, engineering, or other sketches; hand-written texts; digital reproductions on photosensitive paper; and duplicate copies of the preceding.
  • Cards, published or drawn; hard copy cards, with or without enclosures or embellishments, carrying personalized congratulations, greetings, or notifications.
  • Calendars, including chronological blocks, of any form, are printed.
The GST, like the previous Value Added Tax, includes the notion of Input Tax Credits (commonly known as ‘ITC’). Simply put, this implies that the ultimate product vendor must pay GST at the current rate but can seek credits for all GST paid by his suppliers. If GST was applied to the books, the author would have been entitled to receive ITC on the GST paid to its vendors. However, the issue of obtaining such credits does not emerge because there is no GST on books. As a result of the GST paid by the publisher’s suppliers, which is 12% on both paper and printing, the author’s expenses would rise.

The following explanation will help you understand the above arrangement:

Let’s say for ₹10,000, a publisher purchases commodities to publish a book. He must pay the relevant GST on the commodities, which is 18%. The cost of purchasing these commodities has now increased to ₹11800. The book will be priced at ₹15000 when sent for sale to vendors, depending on the economic value with all expenditures included. On the other hand, no GST applies to the books. As a result, the author is responsible for the extra amount of ₹1800, which becomes an additional expense. As a result, the proportion of indirect tax payments gets disrupted, and the publisher’s burden increases.
As a result, the publisher has little choice but to raise the price of the book to recoup the money he has paid.

Note:- We don’t impose any extra amount of tax on the products which is not mentioned in the rules of GST.