Is gst tax applicable on subsidy?

Reply—Under section 2(31) “consideration” in relation to the supply of goods or services or both includes––(a) any payment made or to be made, whether in money or otherwise, in respect of, in response to, or for the inducement of, the supply of goods or services or both, whether by the recipient or by any other person but shall not include any Subsidy given by the Central Government or a State Government.

In the case of Rashmi Hospitality Services Pvt. Ltd. Authority for Advance Rulings, Karnataka in its ruling dated 20.09.2019 held that the Subsidy amount received from the Government of Karnataka for the supply of service of food to the ultimate beneficiaries (consumers) in Indira Canteens by the applicant is excluded from the definition of consideration and would not form the part of the turnover on which tax is liable.