Place of Supply for Data Hosting Services to Foreign Cloud Providers

Last updated: 25 September 2024

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This notification clarifies the place of supply for data hosting services provided by Indian service providers to cloud computing service providers located outside India. It addresses concerns raised by trade and industry regarding the availability of export of services benefits. Previously, some interpretations suggested the place of supply was India, potentially denying these benefits.

Circular No. 232/26/2024-GST

F. No. CBIC-20001/6/2024-GST
Government of India
Ministry of Finance
Department of Revenue
Central Board of Indirect Taxes and Customs
GST Policy Wing
***

New Delhi, dated the 10th September, 2024

To,

The Principal Chief Commissioners/ Chief Commissioners/
Principal Commissioners/ Commissioners of Central Tax (All),
The Principal Directors General/ Directors General (All).

Madam/Sir,

Subject: Clarification on place of supply of data hosting services provided by service providers located in India to cloud computing service providers located outside India-reg.

Representations have been received from the trade and industry seeking clarification on the place of supply in case of data hosting services provided by service providers located in India to cloud computing service providers located outside India.

2. Issue

2.1 It has been represented that some field formations are of the view that the place of supply of data hosting services provided by the service providers located in India to cloud computing service providers located outside India is the location of data hosting service provider in India and therefore, the benefit of export of services is not available on such supply of data hosting services.

For full notification please refer to the attachment

FAQ :

The circular clarifies the place of supply for data hosting services provided by Indian service providers to cloud computing service providers located outside India.

This clarification is for Principal Chief Commissioners, Chief Commissioners, Principal Commissioners, Commissioners of Central Tax, and Principal Directors General, Directors General.

The trade and industry have sought clarification on the place of supply for data hosting services provided by Indian service providers to foreign cloud computing service providers.

Some field formations viewed the place of supply as the location of the Indian data hosting service provider, which could prevent the availability of export of services benefits.

The full notification is available in the attachment mentioned in the article.