GST on Coaching Classes

The GST law aims to strike a delicate balance by granting exemptions to core educational services offered by educational institutions and specified services received by them, while seeking to impose taxes on other services.

Coaching centers and other unaccredited establishments, despite labelling themselves as educational institutions, will not be considered as educational institutions under GST. Therefore, they cannot access the tax exemptions that are typically granted to recognized educational institutions.

As per Notification No. 12/2017-Central Tax (Rate) dated 28^th June 2017, Educational institution means an institution providing services by way of,-

• pre-school education and education up to higher secondary school or equivalent;

• education as a part of a curriculum for obtaining a qualification recognised by any law for the time being in force;
• education as a part of an approved vocational education course.

Hence, services offered by private coaching centers are subject to taxation under the GST Act since such training does not result in the attainment of a recognized qualification.

Example: Brain Crackers a coaching institute in Kota, provides coaching for Institute of Banking Personnel Selection (IBPS) Probationary Officers Exam. Brain Crackers, as a coaching centre specializing in preparing candidates for banking jobs, does not qualify as an educational institution according to the exemption notification.

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