In exercise of the powers conferred by subsection 1 of section

## Policy Analysis Report: Amendment to Union Territory Goods and Services Tax Act, 2017 **1. Executive Summary:** This report analyzes Notification No. 01/2021, an amendment to the Government of India's Notification No. 12/2017 (Union Territory Tax Rate) concerning the Union Territory Goods and Services Tax (UTGST) Act, 2017. The amendment, effective June 2nd, 2021, modifies Schedule I of the original notification by substituting the entry in column 2 against S. No. 259A from something unspecified to "9503" and adds "Diethylcarbamazine" after serial number 230 in List 1. These changes affect the applicable UTGST rates on specific goods. **2. Introduction:** The purpose of this report is to provide an overview and analysis of Notification No. 01/2021, a recent amendment to the Union Territory Goods and Services Tax (UTGST) Act, 2017, as detailed in the provided policy text. This analysis focuses on understanding the specific changes introduced by the amendment and their potential implications. **3. Policy Overview:** * This report analyzes an *amendment* to the original policy: Notification No. 12/2017 Union Territory Tax Rate, dated June 28th, 2017. * **Core Objective(s) (Inferred):** Based on the text, the core objective of the *original* policy, which this amends, appears to be defining Union Territory Goods and Services Tax (UTGST) rates for various goods and services. The amendment's objective is to refine and update these rates for specific items. **4. Background and Rationale:** As the provided document is an amendment, the focus is on the reason for the changes. The amendment text suggests a need to clarify or update the UTGST rates applicable to "9503" classified goods (toys, games and sports requisites), as evidenced by the substitution. The addition of "Diethylcarbamazine" to List 1 suggests a change in the tax treatment of this specific pharmaceutical product, potentially aligning it with other goods in that list. **5. Key Provisions / Changes:** This section focuses specifically on the changes introduced by the amendment. * **Specific Part of Original Policy Changed:** The amendment modifies Schedule I and List 1 of Notification No. 12/2017. * **New Rules/Provisions:** * In Schedule I, against S. No. 259A, the entry in column 2 is changed to "9503". * In List 1, after serial number 230, "Diethylcarbamazine" is added as serial number 231. * **Difference/Effect of Changes:** * The substitution of "9503" clarifies the applicable UTGST rate for goods classified under that specific code. It's impossible to say what the previous classification was, but this amendment solidifies that this now applies. * The inclusion of "Diethylcarbamazine" in List 1 likely subjects it to the UTGST rate applicable to other items in that list. Without knowing the characteristics of List 1, we cannot infer anything more. **6. Target Audience and Stakeholders:** Based on the provided text, the following stakeholders are directly affected: * Manufacturers, suppliers, and retailers of goods classified under "9503" (toys, games and sports requisites). * Manufacturers, suppliers, and distributors of Diethylcarbamazine. * Consumers purchasing these goods in Union Territories. * Tax authorities responsible for collecting UTGST. **7. Implementation Aspects (Inferred):** * **Responsible Agency/Bodies:** The Ministry of Finance, Department of Revenue, is responsible for issuing the notification. * **Timelines/Procedures:** The notification is effective from June 2nd, 2021. No specific procedures are outlined in the provided text beyond the effective date. * **(Amendment-Specific):** Implementers (businesses) need to adjust their tax calculations and reporting to reflect the changes for items classified as "9503" and Diethylcarbamazine. **8. Expected Outcomes / Impact of Changes:** * The amendment relating to "9503" likely aims to provide clarity and consistency in the application of UTGST to these specific goods, leading to more accurate tax collection and compliance. The effect is most likely to cause a tax adjustment. * The inclusion of "Diethylcarbamazine" in List 1 will alter the tax burden on this medication in Union Territories. The change's impact depends on the rate applied to items in List 1 compared to its previous rate. **9. Conclusion:** Notification No. 01/2021 introduces specific amendments to the Union Territory Goods and Services Tax (UTGST) Act, 2017, focusing on clarifying the tax treatment of goods classified under "9503" and Diethylcarbamazine. These changes likely aim to improve the clarity and accuracy of UTGST implementation for the affected goods. The significance lies in ensuring consistent and appropriate tax application in Union Territories, affecting businesses and consumers involved in the trade of these specific items.

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