We are into leasing of road construction machinery under SAC code of 9973 with GST 18%.But client advised us to charge GST 12% under SAC code 995421.Please advice which is the correct SAC code.
10 August 2018
Transfer of Right to use any goods is classified under Heading 9973, attracting GST @ 18%. Heading 9954 covers construction activity. From your query it appears that you are into leasing of road construction equipment, which is being used by lessee for construction activity. Your services are not construction services, and it shall not be classified under heading 9954. The classification, and rate of tax applied by you under 9973 is perfect and correct.
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