The Government of Maharashtra on July 21, 2023, issued a notification regarding the taxability of shares held in a subsidiary company by the holding company.
This has a reference to the CBIC Circular No. 196/08/2023-GST related to Clarification on the taxability of shares held in a subsidiary company by the holding company
The following has been clarified namely: -
• The Taxability of share capital held in the subsidiary company by the parent company has been clarified as follows namely: -
It states that the activity of holding of shares of a subsidiary company by the holding company per se cannot be treated as a supply of services by a holding company to the said subsidiary company and cannot be taxed under GST.
[Circular No. 16 T 0f 2023]
