Thursday, March 15, 2007

SERVICE TAX


  • No change in Service Tax rates. 
  • Basic exemption limit for service providers raised from Rs. 4 lacs to Rs. 8 lacs.
  • Basic exemption for obtaining Service Tax Registration number raised from Rs. 3 lacs to Rs. 7 lacs. 
New Services added 
 Following 7 new services are brought under tax net :

  • Telecommunication Service 
  • Mining Service
  •  Renting of Immovable Property Service
  • Service involved in the execution of a works 
  • Development and Supply of Content Service 
  • Asset Management including Portfolio Management and all forms of Fund Management Service 
  • Design Services 
Scope of existing services Extended added  
Scope of following services extended

  •  Sale of space or time for Advertisement, amended to include yellow pages and trade catalogs. 
  •  Mandap Keeper Services, Pandal or Shamiana Services and Event Management Services: now include services provided in relation to marriage functions.
  • Banking and other Financial Service: 
  • The words “any other person” substituted with “commercial concern”. 
  • Cash Management proposed to be included. 
  • Management Consultant’s Service : Renamed as management or business consultant’s service. Further the definition explicitly includes business consultancy. 
  • Consulting Engineer’s Service: Computer hardware engineering consultancy proposed to include in consulting engineer’s service. 
  • Rent a Cab Service: Renting of motor vehicle capable of carrying more than 12 passengers is included. However, renting to an educational body is exempt.
Exemptions  
Following Services exempted from service tax

  • All taxable services provided by Technology Business Incubators (TBI) / Science & Technology Entrepreneurship Parks (STEP) 
  • Services provided by Resident Welfare Associations to members where monthly contribution does not exceeds Rs 3000/-.
  • Services provided to delivery of content of cinema in digital form after encryption electronically  
  • Services provided in relation to Clinical trials subject to certain conditions 

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