Service Tax Ppt
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Transcript of Service Tax Ppt
Presentation on Service Tax
submitted By
Praveenkumar S.NSomesha M.R
SERVICE TAX
The law provides the definition of Service Tax as - "service tax"
means tax leviable under the provisions of this Chapter. And "this
chapter" provides definition of various services covered for the
Service Tax.
Service Tax is a form of indirect tax imposed on specified services
called "taxable services". Service tax cannot be levied on any service
which is not included in the list of taxable services. Over the past few
years, service tax been expanded to cover new services.
DEFINITION OF “SERVICE” "Service" means any activity carried out by a person for another for consideration,
and includes a declared service, but shall not include:
(a) an activity which constitutes merely,––
(i) a transfer of title in goods or immovable property, by way of sale, gift or in any
other manner; or
(i) such transfer, delivery or supply of any goods which is deemed to be a sale within
the meaning of clause (29A) of article 366 of the Constitution; or
(ii) a transaction in money or actionable claim ;
(b) a provision of service by an employee to the employer in the course of or in relation
to his employment;
(c) fees taken in any Court or tribunal established under any law for the time being in
force.
History
Service Tax was imposed in 1994 for the first time on telephone
services,, services relating to non-life insurance and services
provided by Stock Brokers. Service Tax is applicable to the
whole of India except the State of Jammu and Kashmir. It also
extends to the designated areas in the Continental Shelf and
Exclusive Economic Zone of India.
Authority for levy (Charging section)
The authority for levy of Service Tax on specified services is
contained in Section 66 of the Finance Act, 1994. At present,
this section stipulates a rate of tax of 12 per cent of the value of
a taxable service. In addition education cess @ 2% and
secondary and higher education cess @1% of amount of service
tax is also leviable.
Registration
The taxpayer has to submit an application in form ST-1 for
registering himself with the jurisdictional Superintendent of
Central Excise. This application is to be made within 30 days
from the date a particular Service Tax is levied or within 30 days
from the date of commencement of business, The Superintendent
grants a certificate of registration in form ST-2 within 7 days
failing which it will be deemed as if the taxpayer has been
registered.
Exemptions Retrospective exemptions granted
for repair of roads to management, maintenance or repair services undertaken in relation to non
commercial Government buildings for supply of taxable services by DTA units to authorized operations of SEZ to services provided by Association of Dyeing units in relation to common
effluent treatment plants
Scheme for penalty waiver for renting of immovable property
Penalty would be waived for those tax payers who pay the service tax due on
the renting of immovable property service (as on 6th day of March, 2012) in full
along with interest within 6 months.
Exemptions (Cont’d…) Some Proposed Exemptions of Services:
Given to UN and International Organisations
Healthcare services
Veterinary Clinics
Charitable services under Income tax
Renting for religion
Advocates to individuals
Technical testing for clinical research
Training / Coaching in arts, culture, sports
Specified services to educational institutes
Specified services of a recognised sports body
Sponsorship of tournaments
Construction for Government etc.,
DECLARED SERVICES – SECTION 66E
(a) renting of immovable property;
(b) construction of a complex, building, civil structure or a part thereof, including
a complex or building intended for sale to a buyer, wholly or partly, except where
the entire consideration is received after issuance of completion-certificate by the
competent authority
(c) temporary transfer or permitting the use or enjoyment of any intellectual
property right;
(d) development, design, programming, customization, adaptation, up gradation,
enhancement, implementation of information technology software;
(e) agreeing to the obligation to refrain from an act, or to tolerate an act or a
situation, or to do an act;
NEGATIVE LIST OF SERVICES
SECTION 66D (a) services by Government or a local authority excluding the
following services to the extent they are not covered elsewhere —
(i) services by the Department of Posts by way of speed post, express parcel post,
life insurance and agency services provided to a person other than
Government;
(ii) services in relation to an aircraft or a vessel, inside or outside the precincts of
a port or an airport;
(iii) transport of goods or passengers; or
(iv) support services…. provided to business entities
(b) services by the Reserve Bank of India;
(c) services by a foreign diplomatic mission located in India
Sr.
NoDescription of Service
Service Recipient (Body Corporate)
Service Provider (Individual, Firm, LLP)
1
Hiring of Motor vehicles designed to carry passenger
(a)with abatement
(b)without abatement
100%
40%
NIL
60%
2 Supply of manpower for any purpose 75% 25%
3 Works contract service 50% 50%
4.services provided by individual advocate to business entity 100 -
New Services Covered under Reverse Charge MechanismIn the cases below both the service provider and service receiver will be considered as persons liable to pay the tax on a predetermined percentage
Other Changes Rule 7 has been proposed to be deleted. Presently it provides provisions for determination of
valuation of taxable services provided from outside India.
Section 67A is being inserted to prescribe the relevant date for the application of rate of exchange, valuation or rate of service tax. In lieu thereof Rule 5B of Service Tax Rules has been proposed to be deleted.
It is proposed to introduce Special Audit Provisions separately under the Finance Act, 1994 to give comprehensive powers for such audit relevant for service tax purposes. Presently the same are made available and applicable through the Central Excise Act
To encourage quick settlement of disputes and save the business from the worries of prosecution in certain situations, new provisions relating to Settlement Commission under Central Excise Act are made applicable to Service Tax.
At present in service tax, appeals against the order of Commissioner (Appeals) lie before the Tribunal; whereas in Central Excise, a revision mechanism is available to hear certain specified matters. It is proposed to introduce revision mechanism for service tax, to the extent applicable
Prosecution for non-issue of invoice within time specified would be invoked only if the same is done knowingly with the intent to evade payment of service tax
Provisions relating to Settlement Commission are being brought in the Service Tax by adding sections 31, 32 and 32A to 32P of the Central Excise Act in section 83.
Declared ServiceDeclared Service’ has been defined vide Section 66E as an activity carried out by a person for another for consideration and specified in section 66E of the Act. The following nine activities have been specified in section 66E:
Declared Service Previously Taxable under
Renting of Immovable property; Renting of Immovable property;
Construction of a complex, building, civil structure or a part thereof, including a complex or building intended for sale to a buyer, wholly or partly, except Where the entire consideration is received after issuance of certificate of Completion by a competent authority;
Construction of Residential / Commercial Complex
Temporary transfer or permitting the use or enjoyment of any intellectual property right;
Intellectual Property Service
Development, design, programming, customization, adaptation, up gradation, enhancement, implementation of information technology software;
Information Technology Software Services
Agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act;
If the above activities are carried out by a person for another for consideration it would amount to provision of service. Most of these services are presently also being taxed except in so far as Sl. No.5 is concerned. It is clarified that they are amply covered by the definition of service but have been declared with a view to remove any ambiguity for the purpose of uniform application of law all over the country.
Activities in relation to delivery of goods on hire purchase or any system of payment by installments;
Service portion in execution of a works contract; Work Contract Service
Service portion in an activity wherein goods, being food or any other article of human consumption or any drink (whether or not intoxicating) is supplied in any manner as part of the activity.
Outdoor Catering / Restaurant Service
Transfer of goods by way of hiring, leasing, licensing or any such manner without transfer of right to use such goods;
Supply of tangible goods for use
Covered Service Tax
Sr.No Service Category Date of Introduction
1 Advertising 01.11.1996
2 Air Travel Agent 01.07.1997
3 Airport Services 10.09.2004
4 Architect 16.10.1998
5 ATM Operations, Management or Maintenance 01.05.2006
6 Auctioneers' service, other than auction of property under directions or orders of a count of or auction by Central Govt.
01.05.2006
7 Authorized Service Station 16.07.2001
8 Auxiliary to General Insurance 16.07.2001
9 Auxiliary to Life Insurance 16.08.2002
10 Banking & Other Financial Services 16.07.2001
11 Beauty Parlor 16.08.2002
12 Broadcasting 16.07.2001
13 Business Auxiliary Service 01.07.2003
14 Business Exhibition Service 10.09.2004
15 Business Support Service 01.05.2006
16 Cable Operator 16.08.2002
17 Cargo Handling 16.08.2002
18 Chartered Accountant 16.10.1998
19 Cleaning Service 16.06.2005
20 Clearing & Forwarding Agent 16.07.1997
21 Clubs and Associations 16.06.2005
22 Commercial or Industrial Construction 10.09.2004
23 Commercial Training or Coaching 01.07.2003
24 Company Secretary 16.10.1998
25 Construction of Residential Complex 16.06.2005
26 Consulting Engineer 07.07.1997
27 Convention Centre 16.07.2001
28 Cost Accountant 16.10.1998
29 Courier Services 01.11.1996
30 Credit Card, Debit Card, Charge Card or other payment card related services
01.05.2006
31 Credit Rating Agency 16.10.1998
32 Custom House Agent 15.06.1997
33 Dredging 16.06.2005
34 Dry Cleaning 16.08.2002
35 Erection, Commissioning or Installation
01.07.2003
36 Event Management 16.08.2002
37 Fashion Designer 16.08.2002
38 Forward Contract Services 10.09.2004
39 Franchise Service 01.07.2003
40 Foreign Exchange Broker 01.07.2003
41 General Insurance 01.07.1994
42 Health Club & Fitness Centre 16.08.2002
43 Intellectual Property Service 10.09.2004
44 Interior Decorator 16.10.1998
45 Internet Café 01.07.2003
46 Internet Telecommunication Service 01.05.2006
47 Life Insurance 16.08.2002
48 Mailing List Compilation and Mailing 16.06.2005
49 Management Consultant 01.07.1997
50 Maintenance or Repair Service 01.07.2003
51 Mandap Keeper 16.10.1998
52 Manpower Recruitment or Supply Agency
07.07.1997
53 Market Research Agency 16.10.1998
54 On-line Information & Database Access or Retrieval Service
16.07.2001
55 Opinion Poll Service 10.19.2004
56 Outdoor Caterer 10.09.2004
57 Packaging Service 16.06.2005
58 Pandal or Shamiana Services 10.09.2004
59 Photography 16.07.2001
60 Port Service( Major Ports) 16.07.2001
61 Port Services( Other Ports) 01.07.2003
62 Public Relations Service 01.05.2006
63 Rail Travel Agent 16.08.2002
64 Real Estate Agent / Consultant 16.10.1998
65 Recovery Agent 01.05.2006
66 Registrar to an Issue 01.05.2006
67 Rent - a - Cab Operator 16.07.1997
68 Sale of space or time for Advertisement, other than print media
01.05.2006
69 Scientific or Technical Consultancy 16.07.2001
70 Security Agency 16.10.1998
71 Share Transfer Agent 01.05.2006
72 Ship Management service 01.05.2006
73 Site Preparation 16.06.2005
74 Sound Recording 16.07.2001
75 Sponsorship service provided to any body corporate or firm, other than sponsorship of sports event
01.05.2006
76 Steamer Agent 15.06.1997
77 Stock Broker 01.07.1994
78 Storage & Warehousing 16.08.2002
79 Survey & Exploration of Minerals 10.09.2004
80 Survey and Map Making 16.06.2005
81 T.V. & radio Programme Production Services 10.09.2004
82 Technical Testing & Analysis 01.07.2003
83 Technical Inspection & Certification Agency 01.07.2003
84 Tour Operator 01.09.1997
85 Transport of goods by Air 10.09.2004
86 Transport of goods by Road 01.01.2005
87 Transport of goods in containers by rail {‘other than Indian railway’ omitted w.e.f. 01.09.2009}
01.05.2006
88 Transport of goods other than water, through Pipeline or other conduit
16.06.2005
89 Transport of passengers embarking on international journey by air, other than economy class passengers
01.05.2006
90 Transport of persons by cruise ship 01.05.2006
91 Travel Agent other than Air & Rail Travel 10.09.2004
92 Underwriter 16.10.1998
93 Video Tape Production 16.07.2001
94 Telecommunication 01.06.2007
95 Renting of immovable property 01.06.2007
96 Works contract 01.06.2007
97 Content Development & Supply 01.06.2007
98 Asset Management 01.06.2007
99 Mining Services( Oil & Gas) 01.06.2006
100 Design Services 01.06.2007
101 Information Technology Software services 16.05.2008
102 Investment Management for ULIP 16.05.2008
103 Recognized Stock Exchange 16.05.2008
104 Recognized Associations-Commodity Exchange Services
16.05.2008
105 Clearing & Processing House services 16.05.2008
106 Supply of Tangible Goods services 16.05.2008
107 Cosmetic or Plastic Surgery Services 01.09.2009
108 Transport of Coastal goods, Goods through National Waterways or Goods through Inland Waterways
01.09.2009
109 Legal Consultancy Services 01.09.2009
110 Promotion, marketing or organizing of games of chance including lottery, bingo etc. services
01.07.2010
111 Health services undertaken by Hospitals or Medical establishments
01.07.2010
112 Maintenance of Medical Records services 01.07.2010
113 Promotion of Brand of Goods, Services etc. 01.07.2010
114 Services of Permitting Commercial Use or Exploitation of any event
01.07.2010
115 Electricity Exchange Services 01.07.2010
116 Copyright Services 01.07.2010
117 Services provided by Builder in relation to preferential location, internal/external development etc
01.07.2010
118
Services of Air-conditioned restaurants having license to service alcoholic beverages in relation to service of food or beverages.
1.5.2011
119
Services of providing of accommodation in hotels / inns/ cubs/ guest houses/ campsite for a continuous period of less than three months
1.5.2011