Clarification on taxability of printing contracts.

Circular No.: 11/11/2017-GST
Date of Circular: 20th October 2017
Relevant Sections and Rules:

• Central GST Act, 2017:
  • Section 2(30): Definition of Composite Supply
  • Section 2(90): Definition of Principal Supply
• Relevant Notifications and Classifications:
  • Notification No. 11/2017-Central Tax (Rate) – Service Classification
  • Customs Tariff Act, 1975 – Chapter 48 & 49 (Printed Goods)
  • Services Classification – Heading 9989 (Printing Services)

Summary of Circular:

This circular clarifies whether printing contracts involving supply of items like books, pamphlets, brochures, envelopes, boxes, etc.—with content (logo, design, etc.) provided by the customer—constitute a supply of goods or services under GST.

1. Composite Supply Classification Principle:
   The nature of such printing contracts is generally that of composite supply. Whether the supply is classified as goods or services depends on the principal supply component.
2. Printing of Books and Reports (Service):
   Where the content is provided by the recipient and physical inputs (paper, ink) are owned by the printer (e.g., in printing books, brochures, annual reports), the principal supply is printing service.
   ➤ Classified as a service under Heading 9989.
3. Printed Stationery & Packaging (Goods):
   For items like printed envelopes, letter cards, boxes, tissues, wallpapers, where the content (logo/design) is provided by the recipient but the physical product is of significant importance and belongs to the printer, the dominant element is the supply of goods.
   ➤ Classified as goods under Chapter 48 or 49 of Customs Tariff.

The core determinant is whether the dominant component is the content/printing (service) or the printed article itself (goods).

Source: Circular No.: 11/11/2017-GST