Applicable GST Rate on Priority Sector Lending Certificates (PSLCs) and Renewable Energy Certificates (RECs): Circular No. 46/20/2018-GST The Ministry of Finance issued Circular No. 46/20/2018-GST on 6th June 201
<p><span>The Ministry of Finance issued Circular No. 46/20/2018-GST on 6th June 2018 to clarify the classification and applicable GST rate on Renewable Energy Certificates (RECs) and Priority Sector Lending Certificates (PSLCs). Here's a summary of the key highlights:</span></p><p><span><strong>1. Classification and GST Rate on RECs and PSLCs</strong></span></p><ul><li><span>RECs and PSLCs, along with similar certificates, are classified under heading 4907.</span></li><li><span>These certificates attract a GST rate of 12%.</span></li></ul><p><span><strong>2. Context from Earlier Clarifications</strong></span></p><ul><li><span>An earlier clarification had stated that MEIS and similar scrips are classified under heading 4907 and attract 12% GST.</span></li><li><span>Duty credit scrips under the same heading were exempted from GST.</span></li></ul><p><span><strong>3. Modification of Previous Clarification</strong></span></p><ul><li><span>Circular No. 34/8/2018-GST had indicated that PSLCs attract an 18% GST rate under a residual entry.</span></li><li><span>This has now been re-examined, and PSLCs along with RECs are confirmed to attract 12% GST under heading 4907.</span></li></ul><p><span><strong>4. Non-Applicability of Residual Entry</strong></span></p><ul><li><span>The 18% GST rate under the residual entry is applicable only to goods not covered under other specific entries in Schedule I, II, IV, V, or VI.</span></li><li><span>Since RECs and PSLCs are covered under heading 4907, they do not fall under the residual entry.</span></li></ul><p><span><strong>5. Duty Credit Scrips</strong></span></p><ul><li><span>Duty credit scrips under heading 4907 continue to attract Nil GST as specified under notification No. 2/2017-Central Tax (Rate).</span> <a href="https://cms.plasament.com/storage/circular-no46.pdf">circular_no.46</a><br> </li></ul>