The Central Board of Excise and Customs (CBEC) last day notified amended Integrated Goods and Services Tax (IGST) Rules prescribing apportionment of IGST with respect to advertisement services.
The Boards guidelines deals with determination of proportion of value attributable to different States or UTs, in case of advertisement services supplied to Central or State Government, a statutory body or a local authority under Section 12(14) of IGST Act, 2017 in the absence of any contract between supplier and recipient of service. However, in case of newspapers and publications, amount payable for publishing an advertisement in all the editions of a newspaper or publication, published in a State/UT, the value shall be the value of advertisement service attributable to the dissemination in such State/UT.
In case of printed material (like pamphlets, leaflets, etc.) amount payable for distribution of specific number of such material shall form basis, similarly, in case of hoardings (other than those on trains), amount payable for hoardings located in each State/UT shall be the basis.
Where advertisements are placed on trains, breakup of amount payable, basis ratio of length of railway track in each State/UT for that train, shall be the basis for calculation, and in case of advertisements on railway tickets, the breakup calculated basis of ratio of number of railway stations in each State/UT, when applied to the amount payable for such advertisements, shall constitute value of advertisement service attributable to dissemination in such State/UT.
It stated that in case of advertisements on back of utility bills of oil and gas companies etc, amount payable for advertisements on bills pertaining to consumers having billing addresses in such States or Union territory shall be considered, and in case of advertisement on television channels, same shall be determined on the basis of viewership in each State.
Also, amount payable to a cinema hall/screens in a multiplex, ratio of internet subscribers and telecom subscribers in a State/UT shall be the basis for determination of value of service in case of advertisements at cinema halls, over internet, and through SMS.
The above rules are applicable from 1st July 2017.
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