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Issue of GST on intermediary services to foreign clients may get resolved

However, there could be issues in claiming input tax credit by these intermediaries

Indivjal Dhasmana New Delhi

Premium

GST

4 min read Last Updated : Apr 25 2023 | 1:39 PM IST

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Deciding the place of supply under the goods and service tax (GST) is a complicated issue with different interpretations of the tax regime. The complications got accentuated with regard to intermediaries like agents, brokers, and middlemen to clients located outside India.

Suppose a foreign company wants to sell its products in India and hires a commission agent to facilitate this trade. The agent will facilitate this by charging a commission.

The issue at the crux now is whether this kind of commission can be taxed under the GST regime when services are consumed outside India, and if yes, which tax would apply to them -- integrated GST (IGST), central GST (CGST) or state GST (SGST).