Printers of India in Dilemma

By Prof Kamal Chopra, President, AIFMP
With 250,000 printing companies, India is considered to be the leading country, but now after GST the printers of the country are confused with dissimilar notifications. On one end as per the officers of Finance Ministry that ‘Now’ printing is considered to be ‘Supply of Services’. It is therefore, wherever the printing units are engaged in producing customized printed material, they 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 28.06.2017 i.e. 18%. Except for printing of Books, newspapers, journals and periodicals where only content is supplied by the publisher andthe physical inputs including paper used for printing belongs to the printer the GST is 12%.While using the App GST Rate Finder App of CBEC, if you type printed brochures, leaflets it shows HSN 4901 with 5% GST. Mean it is under ‘Supply of Goods’ it is difficult to understand how the officials of FM is confusing by clarifying that these products of a printer falls under ‘Supply of Services’.
On the other end the GST rates given under chapter 48 and 49 in the notification no.1/2017-integrated tax (rate) issued on 28 June 2017 are contrary. No clarification is given by the government till date as to which GST rates are to be charged by the printers. 250,000 printing companies of 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 17th March, 2012. It is not clear as if the exemption given to ‘Printing industry’ is still inforce.
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 ‘contents’ will always be from the owner/customer, take the example of brochure, poster, catalogue or any other item. Suppose if there is an owner of the ‘content’ who is a printer also in that 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’.
In an recent clarification issued by the CBEC and Customs & Comm. Taxes Dept., published in various newspapers it is given that ‘Printed’ Cartons, boxes and cases of corrugated paper or paper board fall under the heading 4819 and attract 12% GST. (Printed) Folding cartons, boxes and cases of non-corrugated paper and paperboard falling under 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 an 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.