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Notification No. 7/2022 – UT Tax (Rate) Explained

by Shakshi Bharti | Feb 5, 2024 | GST, 2022 Notifications, Notifications, Union Territory Tax (Rate) 2022 Notifications | 0 comments

Notification No. 7/2022 - Union Territory Tax (Rate)

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Important Keyword: Notification 7/2022 UT Tax, GST pre-packaged goods, UTGST amendment 2022, Union Territory Tax rate changes, GST compliance, Notification No. 7/2022 - Union Territory Tax (Rate)

Words:1456; Read time: 8 minutes.

[F. No.190354/172/2022-TRU]
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
(Department of Revenue)

New Delhi, the 13^th July, 2022

Notification No. 7/2022 - Union Territory Tax (Rate): Seeks to amend notification No. 2/2017- Union Territory Tax (Rate)

[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB- SECTION (i)]

G.S.R......(E).- In exercise of the powers conferred by sub-section (1) of section 8 of the UTGST Act, 2017 (14 of 2017), the Central Government, on the recommendations of the Council, hereby makes the following further amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 2/2017-Union Territory Tax (Rate), dated the 28^th June, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 711(E), dated the 28^th June, 2017, namely:-

In the said notification,

in the Schedule, -

against S. Nos. 9 and 22, in column (3), for the portion beginning with the words “other than those put up in” and ending with the words “conditions as in the ANNEXURE I]”, the words “, other than pre-packaged and labelled” shall be substituted;

against S. No. 26, for the entry in column (3), the entry “Curd, Lassi, Butter milk, other than pre-packaged and labelled” shall be substituted;

against S. Nos. 27, 29, 30B, 45, 46A, in column (3), for the portion beginning with the words “other than those put up in” and ending with the words “conditions as in the ANNEXURE I]”, the words “, other than pre-packaged and labelled” shall be substituted;

against S. No. 46B, in column (3), for the portion beginning with the words “[other than those” and ending with the words “conditions as in the ANNEXURE I]”, the words “, other than pre-packaged and labelled” shall be substituted;

against S. Nos. 65, 66, 67, 68, 69, 70, 71,72, 73, 74 and 75, in column (3), for the portion beginning with “[other than those” and ending with the words “conditions as in the ANNEXURE I]]”, the words “, other than pre- packaged and labelled” shall be substituted;

against S. Nos. 77 and 78, in column (3), for the portion beginning with the words “[other than those” and ending with the words “conditions as in the ANNEXURE I]]”, the words “, other than pre-packaged and labelled” shall be substituted;

against S. No. 94, for the entry in column (3), the entry “(i)Jaggery of all types including Cane Jaggery (gur), Palmyra Jaggery, other than pre-packaged and labelled.; (ii) Khandsari Sugar, other than pre-packaged and labelled” shall be substituted;

against S. No. 95, in column (3), after the word “Murki”, the words and symbols “, other than pre-packaged and labelled” shall be inserted;

against S. No. 97A, in column (3), for the portion beginning with the words “other than those put up” and ending with the words “as specified in the ANNEXURE I]”, the words “, other than pre-packaged and labelled” shall be substituted;

against S. No. 99, in column (3), the word “purified, ” shall be omitted;

against S. No. 108, in column (3), for the portion beginning with the words “[other than those” and ending with the words “conditions as in the ANNEXURE I]]”, the words “, other than pre-packaged and labelled” shall be substituted;

S. Nos. 118 and 122 and the entries relating thereto shall be omitted;

against S. No. 132A, in column (3), for the portion beginning with the words “other than those put up” and ending with the words “as in the ANNEXURE I]”, the words “, other than pre-packaged and labelled” shall be substituted;

S. No. 141 and the entries relating thereto shall be omitted;

after the Schedule, in the Explanation, for clause (ii), the following clause shall be substituted, namely:-
“(ii) The expression ‘pre-packaged and labelled’ means a ‘pre-packaged commodity’ as defined in clauses (l) of section 2 of the Legal Metrology Act, 2009 (1 of 2010) where, the package in which the commodity is pre-packed or a label securely affixed thereto is required to bear the declarations under the provisions of the Legal Metrology Act, 2009 (1 of 2010) and the rules made thereunder.”.

2. This notification shall come into force on the 18^th day of July, 2022.

(Vikram Vijay Wanere)
Under Secretary to the Government of India

Note: - The principal notification No. 2/2017-Union Territory Tax (Rate), dated the 28^th June, 2017, was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 711(E), dated the 28^th June, 2017 and was last amended vide Notification No. 19/2021-Union Territory Tax (Rate) dated the 28^th December, 2021, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number GSR 897(E), dated the 28^th December, 2021.

📚 Frequently Asked Questions (FAQs): Notification No. 07/2022 - Union Territory Tax (Rate)

Q1: What is Notification No. 7/2022 - Union Territory Tax (Rate) all about?

Answer:
Notification No. 7/2022, issued on 3th July 2022, amends Notification No. 2/2017 – UT Tax (Rate). It primarily introduces GST on “pre-packaged and labelled” goods, aligning with the Legal Metrology Act, 2009. Earlier exemptions for loose items like curd, lassi, jaggery, and buttermilk were modified—now GST applies if they are sold in pre-packaged and labelled formgst-uttr7-2022.

Q2: Which commodities are affected by this amendment? 🍶🍯

Answer:
The amendment impacts several commonly used items, such as:
Curd, lassi, buttermilk (if pre-packaged and labelled)
Jaggery and khandsari sugar (pre-packaged form)
Murki and other food items in packaged units
Cereals, pulses, and flours (pre-packed)
Unpacked, loose, or unlabelled items continue to remain tax-free.

Q3: What does “pre-packaged and labelled” mean in this context?

Answer:
As per the Legal Metrology Act, 2009, a pre-packaged commodity is one that is packed without the buyer being present, and the package must display mandatory declarations (such as weight, price, manufacturer, etc.). If such labelling exists, GST is applicable under this notificationgst-uttr7-2022.

Q4: From when did Notification No. 7/2022 come into force?

Answer:
This notification became effective on 18th July 2022. From this date, GST started applying to relevant pre-packaged and labelled items.

Q5: How does this impact small businesses and traders? 🏪

Answer:
Small kirana shops selling loose goods are not affected, as GST applies only to pre-packaged and labelled items.
Packaged food brands and distributors must now charge GST on products like packaged flour, rice, curd, or jaggery.
Compliance requirements for labelling and GST invoicing increase for FMCG companies.
For smooth compliance, businesses can explore GST Compliance services offered by Finodha.

Q6: Why was this amendment introduced?

Answer:
The GST Council recommended these changes to:
Expand the tax base
Reduce disputes over loose vs. packaged goods
Align GST with consumer protection laws under the Legal Metrology Act
Bring uniformity across states and union territories.

Q7: Where can businesses get help in managing GST obligations?

Answer:
Businesses can rely on Finodha’s professional services:
GST Registration 📑
GST Return Filing 💻
Private Limited Company Registration 🏢
MSME Registration 💼
Finodha’s GST experts provide complete support for compliance.

Q8: Were there any items completely removed from the exempt list?

Answer:
Yes ✅. Certain entries such as S. Nos. 118, 122, and 141 from the exemption schedule were fully omitted, meaning such goods no longer enjoy UTGST exemptiongst-uttr7-2022.

Q9: Does this notification affect Union Territories differently from states?

Answer:
Yes. While states operate under SGST notifications, Union Territories without legislatures (like Chandigarh, Dadra & Nagar Haveli, Andaman & Nicobar Islands, etc.) follow UTGST rules. Notification No. 7/2022 ensures uniformity in taxation across all Union Territories.

✅ Summary:

Notification No. 7/2022 – Union Territory Tax (Rate) ensures GST applies to pre-packaged and labelled commodities, harmonizing tax treatment and reducing loopholes. Loose or unlabelled goods remain exempt, protecting small traders while bringing larger packaged businesses under the GST net.