Service Tax rate increased from
12.36% (including education cess and secondary and higher
education cess) to 14% (with effect from a date to be
notified after the enactment of the Finance Bill, 2015).
Till the time the revised rate come
into force, the levy of 'Education Cess' &
'Secondary & Higher Education Cess' shall
Imposition of Swachh Bharat Cess
Imposes Swachh Bharat Cess on all or
any of the taxable services @ 2% w.e.f. from a date to be notified
by the Central Govt. in this regard. It will not have any immediate
Review of the Negative List (Effective from a date to be
Service tax levy extended to
amusement facility providing fun or recreation by means of rides,
gaming devices or bowling alleys in amusement parks, amusement
arcades, water parks, theme parks, etc.
Service Tax imposed on admission for
entertainment events such as concerts, non-recognized sporting
events, pageants, music concerts, award functions, if admission fee
more than INR 500.
Irrespective of admission fee, no tax
on exhibition of cinematographic film, circus, recognized sporting
events, dance, theatrical performances including drama and
Service Tax extended on contract
manufacturing / job work for production of potable liquor.
Service Tax imposed on support
service by Govt. or local authority to a business entity, unless
Withdrawal of exemptions from April 1, 2015
Exemption only on specified services
of construction, erection and commissioning provided to Govt. and
shall be limited to historical monument, archaeological site,
canal, dam, pipeline and conduit or plant for (i) Water supply (ii)
Water treatment or (iii) Sewerage treatment or disposal.
Exemption withdrawn Construction,
erection, commissioning or installation of original works
pertaining to an airport or port.
Exemption withdrawn on services by a
performing artist in folk or classical art form, if amount charged
is more than INR 1,00,000.
Exemption to transportation of food
stuff by rail, or vessels or road limited to food grains.
Exemption withdrawn for services by
mutual fund agent to a mutual fund or assets management company,
distributor to a mutual fund or AMC.
Exemption withdrawn on departmentally
run public telephone, guaranteed public telephone operating only
local calls, telephone calls from free telephone at airport and
New exemptions from April 1, 2015
Exemption on pre-conditioning,
pre-cooling, ripening, waxing, retail packing, labeling of fruits
Exemption on service by Common
Effluent Treatment Plant operator for treatment of effluent.
Exemption on service by way of
exhibition of movie by the exhibitor to the specified class of
Exemption for transportation of a
patient to and from a clinical establishment by a clinical
establishment, including by an ambulance.
Exemption for admission to a museum,
zoo, national park, wild life sanctuary, and a tiger reserve.
Exemption for goods transport agency
service provided for transport of export goods by road from the
place of removal to an inland container depot, port, etc.
Other Amendments to Finance Act, 1994 (Effective from a date to
Service Tax levy on chit fund foreman
by way of conducting a chit and by distributors or selling agents
For valuation of taxable service in
case of chit fund and lottery distribution, consideration of
service to include reimbursable expenditure or cost incurred and
charged by the service provider and amount retained by the
distributor or selling agent of lottery from gross sale amount of
Penalty imposed not to be more than
10%, if no fraud or collusion, et al.
No penalty if service tax and
interest paid within 30 days of issuance of SCN.
Penalty imposable is 100%, of the
service tax amount involve or if fraud or collusion, et al.
Rationalization of Abatements from April 1, 2015
Uniform abatement for transport by
rail, road and vessel, Service Tax payable on 30% of value of
Service Tax payable on 60% of the
value of air transport of passenger for higher classes.
Exemption withdrawn on chit fund
Reverse Charge Mechanism from April 1, 2015
Full reverse charge on manpower
supply and security services provided by an individual, HUF, or
partnership firm to a body corporate.
Reverse charge mechanism on services
by mutual fund agents, mutual fund distributors and agents of
Credit allowed on service tax paid
under partial reverse charge by the service receiver without
linking it to the payment to the service provider.
Imposes service Tax on service by
aggregator, if brand name of aggregator used (effective March 1,
Exemption withdrawn on service by
commission agent located outside India to an exporter located in
Cummins Inc. is a foreign company, rendering services in respect of desktop/laptop software license and internet mail facilities to its Indian associated enterprises, i.e. CIL and CSSL which were paying IT charges provided by the taxpayer.
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