The Government of Kerala has introduced a cess as per clause 14 of the Kerala Finance Bill, 2019 called the “Kerala Flood Cess”. Effective Date: The Kerala Flood Cess would be effective from the 1 June 2019 and will be in effect for a period of two years.
The Government of Kerala has introduced a cess as per clause 14 of the Kerala Finance Bill, 2019 called the “Kerala Flood Cess”.
Effective Date: The Kerala Flood Cess would be effective from the 1 June 2019 and will be in effect for a period of two years.
Levy: The Kerala Flood Cess would be levied on intra-state supplies of goods and/ or services made by a taxable person to an unregistered person in respect of supplies specified as under:
Category of Supply |
Rate of Kerala Flood Cess on value of supply |
|
Goods taxable at the rate of 1.5% SGST |
0.25% |
|
Goods taxable at the rate of 6%,9% or 14% SGST |
1% |
|
All Services under SGST |
1% |
Note: This cess would not be leviable on (i) supplies under composition levy, (ii) exempted supplies and (iii) supplies between two registered taxable persons.
Collection: The Kerala Flood Cess would be collectible on the taxable value of supplies as specified above, shown separately in the invoice and paid to the government along with the return.
Kerala Flood Cess is intended to provide a major relief the state of Kerala which is grappling with the aftermaths of the massive flood that occurred in Kerala in August 2018. The collections from such cess would be used to meet reconstruction, rehabilitation and compensation needs of the state.
The Kerala Finance Bill, 2019 adopts the provisions contained in Kerala Goods and Services Tax Act, 2017 in relation to levy as well as collection thereof. Considering this, the said cess should not be included in the value for the purpose of Goods and Services Tax.
While the Notification specifies the effective date as 1 June 2019, it has been decided by the Government of Kerala that the Kerala Flood Cess will be implemented from 1 July 2019. Notification in this regard is awaited.
- Dinesh Kumar Agrawal (Executive Director); Ankit A. Shah (Principal Associate) and Pranay Sahay (Senior Associate)
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