The 54th GST Council meeting brought an unexpected blow to private schools affiliated with boards such as the Punjab School Education Board (PSEB) and the Central Board of Secondary Education (CBSE). The Council declared that the affiliation services provided by these boards are taxable, mandating private schools to pay GST on their affiliation fees moving forward.
This decision has already sparked opposition, with several school associations, including the School Sangh, moving to the High Court to challenge the state's directive to impose 18% GST on affiliation fees. A hearing is set for October, but with the GST Council's recent announcement, schools are preparing for increased financial burdens, especially during affiliation renewals.
Currently, private schools seeking new affiliation with PSEB are required to pay Rs 1.5 lakh in affiliation fees, along with an additional Rs 27,000 as GST. Senior secondary schools face a similar challenge, with an affiliation fee of Rs 50,000 and Rs 9,000 in GST.
While private schools are affected by this GST rule, government schools remain exempt from the tax, according to a GST advocate. In response to the new policy, the Federation of Private School and Association of Punjab has secured a court stay, temporarily halting the GST payments.
The debate continues as private schools weigh legal options to reduce this financial strain, while experts insist on compliance with the revised GST framework.
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