According to the AIFMP statement, the confusion arises from two notification issued on 28 June 2017.

Since printing is now considered to be ‘supply of services’, as per the finance ministry, whenever a printing unit engages in producing customised printed material, it would be treated as ‘supply of printing services’ and would be subjected to GST rates as per serial No 26 & 27 of Notification 11, Central Tax (Rates) dated 28 July 2017. This amounts to 18% GST.

This, however, excludes, printing of books, newspapers, journals and periodicals, where only content is supplied by the publisher and the physical inputs, including paper used for printing belongs to the printer. In this case, the GST is 12%.

Now, if you look for the GST rate of brochures and leaflets, using the GST Rate Finder App launched by the Central Board of Excise and Customs, it shows that this comes under HSN 4901, meaning, 5% GST is applicable to these jobs. This means that these jobs fall under the ‘supply of goods’.

Under these circumstances, the AIFMP statement questioned how the officials are confusing the printers by stating that these products fall under ‘supply of services’.

On the other end, the GST rates given under Chapters 48 and 49 in the notification No 1/2017 Integrated Tax (Rate) issued on 28 June 2017 are contrary to this. The AIFMP said no clarification has been issued by the government till date as to which GST rates are to be charged by the printers.

“More than 250,000 printing companies in India are confused about the implementation of these two different notifications. In this regard, it is not out of place to mention that carrying out an intermediate production process as job work in relation to ‘printing’ is exempted from the service tax (ref Notification No 12/2012 dated 17 March, 2012. It is not clear if the exemption given to ‘printing industry’ is still in force,” the statement said.

The statement said that there can’t be two yardsticks. “If printing is not under ‘supply of goods’, then why items like printing of catalogue, brochure, posters, and many other are given under Chapter 48 and 49 in the Notification No 1/2017 Integrated Tax (Rate) issued on 28 June 2017? For any printed item, the ‘content’ will always be from the owner/ customer, be they brochure, poster, catalogue or any other item. Suppose there is an owner of the ‘content’, who is also a printer. In this case, to whom he will bill such items? Then why such details are given in the Chapter 49? If printing is under ‘supply of services’, there is no legitimacy of GST rates given under Chapter 48 and 49 in the notification No 1/2017 Integrated Tax (Rate) issued on 28 June 2017. It is, therefore, for the sake of clarity, either Chapter 49 may be removed or printed products may be classified to be ‘supply of goods’,” the statement argued.

In an recent clarification issued by the CBEC and Customs & Comm Taxes department, published in various newspapers, it is given that ‘printed’ cartons, boxes and cases of corrugated paper or paperboard fall under the heading 4819 and attract 12% GST. “Yet, (Printed) folding cartons, boxes and cases of non-corrugated paper and paperboard falling under the heading 4819 attract 18% duty. These are also products of printing industry, the content of which is provided by the customer and the printer uses his own inputs for the manufacture of the same. How other printed products are different? For any kind of boxes we (printers) fabricate the box as per the ‘contents’ supplied by the customer. If a printed cardboard box is under ‘supply of products’, why other printed article are to be considered as ‘supply of services,’ is best known to the officials of the FM,” the AIFMP press statement concluded.

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