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Significant Changes in Service Tax from 01.04.2015
| Situation | Rate |
| Invoice is issued and payment is also received on or before 31st May | 12.36% |
| Invoice issued before 31st May but payment is received from 1st June | 12.36% |
| Invoice issued from 1st June, but payment is received before 1st June | 12.36% |
| Invoice and Payment both are from 1st June | 14% |
| Situation | Rate |
| Invoice is issued and payment is also received on or before 31st May | 12.36% |
| Invoice issued before 31st May but payment is received from 1st June | 14% |
| Invoice issued from 1st June, but payment is received before 1st June | 14% |
| Invoice and Payment both are from 1st June | 14% |
CHANGES IN TAXABILITY
| New Provision | Impact | ||
| ANY SERVICE to a business entity are liable for service tax. Consequentially, the definition of support service is withdrawn. |
| ||
Service tax is to be levied on the production / manufacture of alcoholic liquor for human consumption. | This amounts to double levy on such manufacture. Already ED is levied under the special act on such liquor. This levy is in addition to ED | ||
Tickets for admission to amusements facilities are now taxable | Tickets for all theme parks would now be taxable.
Section 65B(9): The definition of “Amusement facility” is omitted from the Act.
Section 65B(24): The definition of “Entertainment Event” is omitted from the Act. |
|
Section
65B(23A): “Foreman of chit fund” shall have the same meaning as is
assigned to the term “foreman” in Section 2(j) of the ChChit Funds Act, 1982
Foreman: Person who is responsible for the conduct of the chit under the chit agreement and includes any person discharging the functions of the chit and includes any person discharging the functions of foreman u/s 39 of Chit Funds Act. |
In case of
lottery agents, the consideration shall also include (Sale Price – Cost Price).
Earlier, it was treated as sale and purchase and hence was excluded. Now the
Government wants to impose service tax on the discount earned by the lottery
agents.
| ||
| Notfn No.3/2015 rescinds this notification. However, since the Place of Provision of such service is outside India as per POPS, the service is still not taxable. | Since the Commission agent is classified as an intermediary, as per Rule 9 of POPS Rules, Location of Service Provider is relevant. As the location is outside taxable territory, it is not taxable. (w.e.f.f. 01.03.2015) | |
GTA services for transportation of exports consignments to port / airport / Land Customs Station are exempt | This exemption is brought in to bring exports through land route at par with other modes of exports. (Notification No.4/2015 w.e.f. 01.04.2015) | |
Health Care services Ambulance services | Notfn No.6/2015 dt.
01.03.2015 (w.e.f. 01.04.2015) |
| Nature of Service | Service Receiver | Liabilty |
| Manpower Supply | Company | 100% of ST liability is on service receiver |
TAXABLE SERVICES W.E.F. 01.04.2015
(a) Construction, Erection, Commissioning, Installation,
Completion, Repairs and Maintenance of
Civil Structure or other original works for non–commercial use
Structure meant for use as (a) educational (b) art (c) Clinical
establishment
Residential complex for self use or use of the Government
employees or MPs / MLAs etc.
(b) Construction, Erection, Commissioning, Installation, Completion, Repairs & Maintenance of airport / port
(c) Performing artist in folk / classical art forms of music,
dance or theatre, if the consideration is > Rs.1 lakh
per performance. (fully taxable if the service is in the nature
of brand ambassador)
(d) Rail transport / GTA of milk, salt and food grain including
flours, pulses and ricealone is exempt. Hence,
transportation of other food stuff, tea, coffee, jaggery, sugar,
milk products, edible oil is liable for ST.
(e) Varishta Bhima Pension Yojana is exempt from ST.
(f) Telephone calls from departmental run telephones, guaranteed public telephones are taxable.
FOLLOWING SERVICES ARE EXEMPT w.e.f. 01.04.2015
(a) Services by operator of
Common Effluent Treatment Plantby way of treatment of effluent
(b) Services by way of pre-conditioning, pre-cooling, ripening, waxing, retail packing, labelling of fruits and vegetables which do not change or alter the essential characteristics of the said fruits or vegetables
(c) Services by way of
admission to a museum, national park, wildlife sanctuary, tiger reserve or zoo
(d) Service provided by way of exhibition of movie by anexhibitor to the distributor or an association of persons consisting of the exhibitor as one of its members
(e) Tickets for (i)
exhibition of Cine films, circus, dance, or theatrical performance including
drama or ballet;
(ii) recognised sporting
event;
(f) Tickets for Award function, concert, pageant, musical performance or any sporting event except a recognised sporting event, where the ticket value is ≤ Rs 500 per person.”
CHANGES IN TAXABLE VALUE AND ABATEMENT (W.E.F. 01.04.2015)
Nature of service Taxable Value Conditions Transportation by Rail and accompanied belongings 30% CENVAT Credit on inputs, input services and Capital goods should not be availed Transportation by air – Economy Class 40% (old rate 40%) CENVAT Credit on inputs and Capital goods should not be availed Transportation by air – Other than economy 60% (old rate 40%) CENVAT Credit on inputs and Capital goods should not be availed GTA 30% (old rate 25%) CENVAT Credit on inputs and Capital goods should not be availed Chit Fund Services 100% (old rate 70%) Vessel Transportation 30% (old rate 40%)
CA T.R.Srinivasan
Shree Guru Kripa’s Institute of Management
Ph.No.: 97899 76079
Mail ID: trs.connects@gmail.com
