CBIC clarifies rules, says no GST to apply on pre-paid gift vouchers, cards
In a recent clarification, the Central Board of Indirect Taxes and Customs (CBIC) provided insights into the goods and services tax (GST) treatment of transactions involving vouchers. According to the CBIC, vouchers can be categorised into two types.
The first category includes prepaid instruments, such as gift cards and digital wallets, which are recognised by the Reserve Bank of India (RBI). These vouchers are treated as ‘money’ under the GST framework, meaning transactions involving them will not be classified as either the supply of goods or services.
The second category comprises non-prepaid vouchers, which do not qualify as prepaid instruments. These vouchers serve as claims to receive specific goods or services and fall under the definition of ‘actionable claims’. Similar to their prepaid counterparts, these transactions also do not count as the supply of goods or services for GST purposes.
The CBIC underlined that, regardless of the type of voucher, transactions involving vouchers themselves will not be construed as the supply of goods or services. However, the actual goods or services that can be redeemed using these vouchers may still be subject to GST.
