CBIC amended the CGST rate of MRO services w.r.t. aircraft from 18% to 5% with full ITC

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CBIC vide Notification No. 2/2020- Central Tax (Rate) dated March 25, 2020 amended Notification No. 11/2017-Central Tax (Rate) dated June 28, 2017 (“Services Rate Notification”) to reduce CGST rate on Maintenance, Repair and Overhaul (“MRO”) services in respect of aircraft from 18% to 5% with full Input Tax Credit (“ITC”) w.e.f. April 1, 2020.

In serial No. 25, after item (i), (ia) is inserted and in item (ii) “and (ia)” is inserted:

S.No.

Heading Description of service Rate in %

Condition

25.

Heading 9987

(ia) Maintenance, repair or overhaul services in respect of aircrafts, aircraft engines and other aircraft components or parts.

2.5

(ii) Maintenance, repair and installation (except construction) services, other than (i) and (ia) above and serial number 38 below.

9

Similar Notifications has been issued  in IGST and UTGST Act as well.

CGST (Rate) Notification- http://www.cbic.gov.in/resources//htdocs-cbec/gst/notfctn-02-2020-cgst-rate-english.pdf

IGST (Rate) Notification- http://www.cbic.gov.in/resources//htdocs-cbec/gst/notfctn-02-2020-igst-rate-english.pdf

UTGST (Rate) Notification- http://www.cbic.gov.in/resources//htdocs-cbec/gst/notfctn-02-2020-utgst-rate-english.pdf

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