Service Tax Taxable Services: Abatement Value (%), Taxable Value (%), Effective Rate (%), New Service Tax in Special Cases. (By.Shyam Makwana)
The below mentioned table show the effective service tax rate wherein different types of abatements are available,
Sl No.
|
Descriptions of Taxable
Services
|
Service Tax
|
Abatement Value %
|
Taxable Value %
|
Effective Rate
|
1
|
Mandap
keeper service
|
14%
|
30%
|
70%
|
9.80%
|
2
|
Tour
operator services
|
||||
Solely of arranging/booking accommodation
|
14%
|
90%
|
10%
|
1.40%
|
|
Package tour
|
14%
|
75%
|
25%
|
3.50%
|
|
Other than both above
|
14%
|
60%
|
40%
|
5.60%
|
|
3
|
Rent-a-cab
scheme operator services
|
14%
|
60%
|
40%
|
5.60%
|
4
|
Transport
of goods by road/goods transport agency service
|
14%
|
70%
|
30%
|
4.20%
|
5
|
Construction
services other than residential complex,including commercial/industrial
buildings or civil structures
|
14%
|
70%
|
30%
|
4.20%
|
6
|
Construction
of residential complex service
|
||||
Carpet area is less than 2000 sq.ft. &
Amt charged less than 1 crore
|
14%
|
75%
|
25%
|
3.50%
|
|
Others
|
14%
|
70%
|
30%
|
4.20%
|
|
7
|
Transport
of passengers embarking on domestic/international journey by air
|
||||
Economy class
|
14%
|
60%
|
40%
|
5.60%
|
|
Other than economy
|
14%
|
40%
|
60%
|
8.40%
|
|
8
|
Transport of goods by rail including transport of goods in
containers by rail (for the present, transport of passengers by rail in
air-conditioned class/first class also may be paid under this
description/accounting code)
|
14%
|
70%
|
30%
|
4.20%
|
9
|
Works contract
service
|
||||
Original works
|
14%
|
60%
|
40%
|
5.60%
|
|
Maintenance or repair or reconditioning or
restoration or servicing
|
14%
|
30%
|
70%
|
9.80%
|
|
10
|
Services in
relation to financial leasing including hire purchase
|
14%
|
90%
|
10%
|
1.40%
|
11
|
Bundled service
by way of supply of food or any other article of human consumption or any
drink, in a premises (including hotel, convention center, club, pandal,
shamiana or any other place, specially arranged for organizing a function)
together with renting of such premises
|
14%
|
30%
|
70%
|
9.80%
|
12
|
Renting of
hotels, inns, guest houses, clubs, campsites or other commercial places meant
for residential or lodging purposes.
|
14%
|
40%
|
60%
|
8.40%
|
13
|
Transport of
goods in a vessel
|
14%
|
70%
|
30%
|
4.20%
|
14
|
Other than
above services (Full Rate on Full Value)
|
14%
|
0%
|
100%
|
14.00%
|
Service Tax has been increased to 14% (including all “Cesses”) from 12.36% earlier from 01.06.2015 , hence service tax is to be charged/collected and paid @ single rate. The payment code to be used will be basic code only and codes related to “Education Cess Code – 00440298” & “ Higher Education Cess Code – 00440426” is not to be used for all liabilities from June 1st 2015.
Service Tax Rate
|
Basic Rate
|
Edu. Cess
|
H.Edu.Cess
|
Codes
|
12.36% Till 31.05.2015
|
12%
|
2%
|
1%
|
Basic
Code (Respective Services)
|
Edu.
Cess - 00440298
|
||||
H.
Edu. Cess - 00440426
|
||||
14% w.e.f. 01.06.2015
|
14%
|
---
|
---
|
Only
Basic Code
|
(Respective
Services)
|
||||
(Inclusive
of all Cesses)
|
The below mentioned table show the effective service tax rate in special cases as per Service Tax Rules, 1994,
Sl No
|
Nature of Services
|
Old Rate
|
New Effective Rate
|
1
|
Domestic Air
Booking
|
0.60%
|
0.70%
|
2
|
International
Air Booking
|
1.20%
|
1.40%
|
3
|
Life Insurance
|
||
First Year Premium
|
3%
|
3.50%
|
|
Subsequent Premiums
|
1.50%
|
1.75%
|
|
4
|
Money Changing
Services
|
||
Amount of
currency exchanged upto INR 0.1 million
|
0.12% (minimum of INR 30)
|
0.14% (minimum of INR 35)
|
|
Amount of
currency exchanged exceeding INR 0.1 million and upto INR1 million
|
Rs.120 and 0.06%
|
Rs.140 and 0.07%
|
|
Amount of
currency exchanged exceeding INR1 million
|
Rs.660 and 0.012% (maximum of Rs.6,000)
|
Rs.770 and 0.014% (maximum of Rs.7,000)
|
|
5
|
Lottery
|
||
Where
guaranteed prize payout is more than 80%
|
Rs.7,000
|
Rs.8,200
|
|
Where
guaranteed prize payout is less than 80%
|
Rs.11,000
|
Rs.12,800
|
As per the “Point of Taxation Rules”, “Rule 4” takes care of taxation when there is change in rate of taxation, the table below shows that effect on applicable rate from 01.06.2015, what would be the position before change in rate and after change in rate of service tax from 12.36% to 14%.
Sr.No
|
Rendering service
|
Invoice Issued
|
Payment Received
|
Rate %
|
1
|
Before Rate Changes
|
Before Rate Changes
|
After Rate Changes
|
12.36
|
2
|
Before Rate Changes
|
After Rate Changes
|
After Rate Changes
|
14
|
3
|
Before Rate Changes
|
After Rate Changes
|
Before Rate Changes
|
12.36
|
4
|
After Rate Changes
|
After Rate Changes
|
Before Rate Changes
|
14
|
5
|
After Rate Changes
|
Before Rate Changes
|
After Rate Changes
|
14
|
6
|
After Rate Changes
|
Before Rate Changes
|
Before Rate Changes
|
12.36
|
“Swachh Bharat Cess”, which is being proposed to be levied @2% from the date notified, is not yet notified so the same would not be applicable as of now.
Shyam Makwana
Service Tax Practitioner
M - 09033822400
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