“If the advertisement agency sells space for advertisement as an agent of the newspaper on commission basis, it would be liable to pay GST at 18 per cent on the sale commission it receives from the newspaper,” said a finance ministry release.

Clarifying on the issue of applicability of Goods and Services Tax (GST) on advertisement in print media, the finance ministry on Wednesday said that a 5 per cent GST would be levied if an advertisement agency buys space from the newspaper and sells such space for advertisement to clients on its own account. However, if the advertisement agency sells space for advertisement as an agent of the newspaper on commission basis, then it would be liable to pay GST of 18 per cent on the commission it receives from the newspaper.
“If the advertisement agency sells space for advertisement as an agent of the newspaper on commission basis, it would be liable to pay GST at 18 per cent on the sale commission it receives from the newspaper. Input tax credit of GST paid on such sale commission would be available to newspaper,” a finance ministry release said.
Also, if the advertisement agency supplies any service other than sale of advertising space, such as designing or drafting the advertisement, and such supply is not a part of any composite supply, then GST at the rate of 18 per cent shall be leviable on the transaction. “If such supplies are part of any composite supply, the rate applicable for the principal supply shall apply,” it said.

Source: Indian Express, 24 August 2017

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