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GST On Various Programmes Being Conducted By The IIMs

Students of 1 year MBA for Executives & other programs leading to a management degree at the Indian Institutes of Management (IIMs) will get benefit from the tax exemption given by the GST Council as IIM Bangalore has secured exemption from Goods and Services Tax (GST) for all programs which are of long duration including the one year full-time MBA (EPGP). IIMB has been given an exemption from GST for their long duration’s programs, which is momentous relief to the students. PGP (Post Graduate Program), FPM (Fellow Programme in Management), PGPPM (Post Graduate Programme in Public Policy), EPGP(Executive PGP) & PGPEM (Post Graduate Programme in Enterprise Management) are the name of courses which are exempted from the GST at Indian Institute of Management.

Education services availed by the Indian Institutes of Management, pursuance to the guidelines of the Centre govt., to their students, by way of the following educational programmes, except Executive Development Programme, –

  1. 2-year full time residential PG Programmes in Management for the PG Diploma in Management, to which admissions are made based on Common Admission Test aka CAT, conducted by Indian Institute of Management.
  2. Fellow programme in Management.
  3. 5-year integrated programme in Management.

In a circular, the Tax Research Unit of the Department of Revenue, has clarified its position in respect to grant of GST exemption to educational institutions. Till now, only the two-year full-time PGP (Post-Graduate program in management) and FPM (Fellow Program in Management) were exempted from GST at IIMs.

Earlier only the flagship programmes like PGP (Post Graduate Programme) & FPM (Fellow Programme in Management), was exempted from the tax slab but now 3 more had been added.

The exemption now applies to these three other long-duration programmes:

  1. PGPPM-Post Graduate Programme in Public Policy and Management
  2. EPGP-Executive Post Graduate Programme
  3. PGPEM-Post Graduate Programme in Enterprise Management

As the IIMs has been exempted from the GST, now it will get a refund of Rs. 4.03 crore for 2018-19. Also, the Indian Institute of Management Bangalore refunded the amount to the students who graduated in the above mentioned three programmes in March 2019.  

The Indian Institutes of Management Act, 2017 get come into effect from 31st January 2018. After this enaction of the Act, IIMs are counted as educational institution and thus exemption at sr. no. 66 to notification no. 12/2017 on 28th June 2017 also available to the Indian Institutes of Managements (IIMs).

Tax Exemption Details

Along with EPGP, 2 other education programs named as the Post Graduate Program in Public Policy and Management (PGPPM) & the Post Graduate Program in Enterprise Management (PGPEM) are also now exempt from GST.

The EPGP course, because of its ‘executive’ tag was clubbed together and denied any tax concessions. IIMB had asked for more clarification & later the GST Council to rectify the oddity.

The tax exemption counted as a positive move. The announced exemption by the GST Council in a circular on January 1, 2019, would also be beneficial for the 1-year program students at IIM Ahmedabad, IIM Indore, IIM Lucknow & IIM Calcutta.