During the pandemic, as education went completely online, India’s Edtech sector benefited greatly. But lately, as students returned to the classrooms, many players in this industry have seen subscription declines. With the Union budget for 2023-2024 being announced on February 1, the Edtech sector expects some delay from the government.
In the latest budget of the Union, Rs 1,04,278 crore was allocated to the education sector. This was an 11% increase over the 2021-22 budget. The latest budget focused on e-learning and digital education, including the expansion of the government’s One Class One TV channel and the establishment of a Digital University.
Currently, major educational services are exempt from GST, but Edtech products such as online courses and lessons fall under the 18% GST bracket. According to industry experts, a reduction in the tax rate could help the platforms make their services cheaper.
“The government says that education is not for profit and that we want to democratize education. The NEP (National Education Policy) says we want to bring multimodal learning. But when you look at the GST we pay, the tax regime has not kept pace,” Sumeet Mehta, co-founder and CEO of WestBridge-backed school Edtech LEAD, told Moneycontrol.
Mr. Mehta added that in order to achieve holistic and multi-modal education, the government should lower the tax rate, making education affordable.
Abhishek Mishra, chief strategy officer, Physics Wallah, told The US Express News that government support is needed for the Edtech industry in the form of subsidized schemes and incentives for online improvement initiatives.
He suggested that collaboration between Edtech platforms and government could improve learning outcomes and digitization.
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