The new service tax rate of 14% is applicable from 1st June 2015 (per Notification No. 14/2015-ST dated 19th May 2015).
- Ensure that all your bills and invoices from that date on has the higher rate of service tax.
- Also ensure that you DO NOT charge the Education and Higher Education Cess (2% and 1%) as the new service tax rate is inclusive of these.
- You do not need to show the Cess in your bills / invoices after 1st June 2015.
Changes (in Rules 6 of Service Tax Rules, 1994) for change in abatement rates of Service Tax for: Air Travel Agent, Life Insurance Business, Foreign Exchange Brokers and Distributor & Selling Agent of Lottery will also be applicable from 1st June 2015 (Notification No. 15/2015-ST dated 19th May 2015).
- In addition following changes are also applicable from 1st June 2015:
- Service Tax on amusement facilities and Entertainment Events. Exemption will be available for following services where tickets are priced at Rs.500 or less per person.
- Service Tax on Liquor Job Work
Date of applicability of following provisions is yet to be notified:
- Expansion of scope of services provided by Government and Local Authority; and
- Applicability of ‘Swachh Bharat Cess’
Do refer to our earlier note on Service Tax Changes from 1st April 2015 either in our earlier newsletter or on our blog.
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