GST Council Proposes Amendment in CGST Act to Insert Definition of Local Fund and Municipal Fund

The GST Council has confirmed that recipients can claim Input Tax Credit (ITC) on Ex-Works contracts. This decision provides clarity on the tax treatment of such contracts under GST, which is crucial for businesses engaged in procurement and manufacturing. Ex-Works contracts involve the delivery of goods at the seller’s premises, with the buyer assuming responsibility for transportation and related costs. Under the new clarification, recipients involved in these contracts can claim ITC on the GST paid, which helps reduce their overall tax burden. This measure is expected to ease the compliance process for businesses involved in manufacturing or trading goods, encouraging transparency and fairness in the application of GST.