{"id":3950,"date":"2022-01-25T17:14:15","date_gmt":"2022-01-25T11:44:15","guid":{"rendered":"https:\/\/www.hostnamaste.com\/blog\/?p=3950"},"modified":"2026-04-17T10:48:00","modified_gmt":"2026-04-17T05:18:00","slug":"what-is-gst-and-how-it-impacts-on-web-hosting-industry-in-india-applicability-of-gst-for-webhosting-companies-or-for-services-provided-through-the-medium-of-internet","status":"publish","type":"post","link":"https:\/\/www.hostnamaste.com\/blog\/what-is-gst-and-how-it-impacts-on-web-hosting-industry-in-india-applicability-of-gst-for-webhosting-companies-or-for-services-provided-through-the-medium-of-internet\/","title":{"rendered":"What is GST and How it Impacts on Web Hosting Industry in India \u2013 Applicability of GST for WebHosting Companies or for Services Provided through the Medium of Internet"},"content":{"rendered":"
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What is GST and How it Impacts on Web Hosting Industry in India \u2013 Applicability of GST for WebHosting Companies or for Services Provided through the Medium of Internet – HostNamaste.com<\/strong><\/span><\/figcaption><\/figure>\n

What is Goods and Service Tax (GST)?<\/b><\/span><\/h2>\n

\ud83d\udcc5 Updated on April 16, 2026: This article has been updated with the latest GST rules, including recent clarifications on data hosting services, export of services, and applicability for web hosting companies in India.<\/span><\/strong><\/span><\/h2>\n

GST is known as the Goods and Services Tax<\/strong><\/a><\/span>.<\/span> It is an indirect tax which has replaced many indirect taxes in India such as the excise duty, VAT, services tax, etc. The Goods and Service Tax Act was passed in the Parliament on 29th March 2017 and came into effect on 1st July 2017.<\/span><\/p>\n

In other words, Goods and Service Tax (GST) is levied on the supply of goods and services. Goods and Services Tax Law in India is a comprehensive, multi-stage, destination-based tax that is levied on every value addition. GST is a single domestic indirect tax law for the entire country.<\/span><\/p>\n

Generally, we have seen that in Invoices supplier charges either CGST + SGST or only IGST. Why is it so? This is because, GST is the consumption-based tax, means charge of CGST + SGST or IGST depends on where particular goods or services are actually consumed. In case of Goods, it\u2019s easy to identify where goods are consumed being tangible in nature, but in case of services it\u2019s difficult to identify where services are actually consumed, especially in case of services provided over the internet. The very purpose of this article is to clearly understand such difficulty in detail.<\/span><\/p>\n

In this guide, we will specifically understand how GST applies to web hosting services, VPS hosting, and other internet-based services in India.<\/span><\/p>\n

Introduction of OIDAR services<\/b><\/span><\/h2>\n

The Central Board of Indirect Taxes and Customs (CBIC) has formed a separate category to capture the services provided and received over the internet (without a physical interface between the supplier and the recipient). Sale of digital content like movies, TV shows, music, etc., is an example here.<\/span><\/p>\n

The Government recognised the need for a separate category for Online Information Database Access and Retrieval (OIDAR) services. These services could be supplied remotely without the supplier having a physical location or presence in India. This needed attention as the remote working format could provide an unfair advantage to service providers located outside India at the cost of Indian service providers providing similar services.<\/span><\/p>\n

With an intention to widen the tax net and to introduce a level playing field to market participants, the CBIC has introduced specific rules for OIDAR service providers. This article will further discuss the OIDAR services and the Place of Supply for such services.<\/span><\/p>\n

Latest GST Rate on Web Hosting Services (2026 Update)<\/span><\/strong><\/span><\/h2>\n

As of 2026, web hosting services in India are taxed under GST at a standard rate of 18%<\/strong>. These services fall under IT services and are generally classified under SAC Code 998315.<\/span><\/p>\n

This GST rate applies to various hosting services including:<\/span><\/p>\n