Notification No. 17/2017 – UTTR Explained

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Notification No. 17/2017 - Union Territory Tax (Rate): To notify the categories of services the tax on intra-State supplies of which shall be paid by the electronic commerce operator

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

G.S.R (E).- In exercise of the powers conferred by sub-section (5) of section 7 of the Union Territory Goods and Services Tax Act, 2017 (14 of 2017), the Central Government, on the recommendations of the Council, hereby notifies that in case of the following categories of services, the tax on intra-State supplies shall be paid by the electronic commerce operator –

services by way of transportation of passengers by a radio-taxi, motorcab, maxicab and motor cycle;

services by way of providing accommodation in hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes, except where the person supplying such service through electronic commerce operator is liable for registration under clause (vi) of section 21 of the Union Territory Goods and Services Tax Act, 2017 read with sub-section (1) of section 22 of the said Central Goods and Services Tax Act.

Explanation.- For the purposes of this notification,-

“radio taxi” means a taxi including a radio cab, by whatever name called, which is in two-way radio communication with a central control office and is enabled for tracking using Global Positioning System (GPS) or General Packet Radio Service (GPRS);

“maxicab”, “motorcab” and “motor cycle” shall have the same meanings as assigned to them respectively in clauses (22), (25) and (26) of section 2 of the Motor Vehicles Act, 1988 (59 of 1988).

2. This notification shall come into force with effect from the 1^st day of July, 2017

(Ruchi Bisht)
Under Secretary to the
Government of India

📚 Frequently Asked Questions (FAQs): Notification No. 17/2017 - Union Territory Tax (Rate)

Q1. What is Notification No. 17/2017-UTT(R)?

Answer: It is a GST notification that shifts GST liability for certain services to Electronic Commerce Operators.
The notification covers specified transportation and accommodation services supplied through digital platforms.

Q2. When did this notification become effective?

Answer: It became effective from 1 July 2017.
The notification specifically states that it would come into force from the first day of GST implementation.

Q3. Which transport services are covered?

Answer: Passenger transportation by radio taxi, motorcab, maxicab, and motorcycle.
These services become subject to GST payment by the Electronic Commerce Operator.

Q4. What is a radio taxi?

Answer: A radio taxi is a taxi connected to a central control office and equipped with GPS or GPRS tracking systems.
The notification specifically provides this definition.

Q5. Are hotel bookings covered?

Answer: Yes, certain accommodation services are covered.
Hotels, inns, guest houses, clubs, campsites, and similar lodging facilities supplied through e-commerce platforms fall within the notification subject to specified conditions.

Q6. Who pays GST under this notification?

Answer: The Electronic Commerce Operator pays GST.
The GST liability shifts from the supplier to the platform facilitating the transaction.

Q7. Does the actual supplier stop being a supplier?

Answer: No.
The supplier continues to provide the service. Only the GST liability mechanism changes.

Q8. Does the notification apply to all services sold online?

Answer: No.
Only the specific services listed in the notification are covered.

Q9. Are bike taxi services included?

Answer: Yes.
Services supplied through motorcycles for passenger transportation are specifically covered.

Q10. What happens if accommodation providers are already liable for GST registration?

Answer: The notification contains a specific exception.
Businesses must examine registration-related provisions carefully before determining liability.

Q11. Does this notification affect Input Tax Credit?

Answer: Not directly.
The notification primarily addresses who pays GST rather than ITC eligibility.

Q12. Are travel aggregators affected?

Answer: Yes, where they qualify as Electronic Commerce Operators and facilitate covered services.
They may become responsible for GST payment under this mechanism.

Conclusion

Notification No. 17/2017-UTT(R) was a landmark step in adapting GST to the digital economy. By making Electronic Commerce Operators responsible for GST on specified transportation and accommodation services, the government simplified compliance and improved tax administration.

For drivers, accommodation providers, digital platforms, and tax professionals, understanding this notification remains important because it laid the groundwork for the GST treatment of platform-based business models in India.

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