Who We Are
No. 156, 27th Cross
Jayanagar 6th Block
Opposite to Ayyappaswamy Temple
Bangalore - 560070
Service Tax Consultants in Bangalore
SAHU & ASSOCIATES:We are Service Tax Consultants in Bangalore.
Service Tax is a tax imposed by Government of India on services provided in India. The service provider collects the tax and pays the same to the government. It is charged on all services except the services in the negative list of services. The current rate is 12.36% on gross value of the service.
History of Service Tax
Service tax had been levied initially at the rate of five per cent flat since 15th July, 1994 till 13th May,2003, at the rate of eight percent flat w.e.f 14th May,2003 to 9th September, 2004 and at the rate of 10% flat plus an education cess of 2% thereon w.e.f 10th September, 2004 on value of all taxable services provided by service providers. The rate of service tax was enhanced to 12% by Finance Act, 2006 w.e.f 18.4.2006.Finance Act, 2007 has imposed a new secondary and higher education cess of one percent on the service tax w.e.f 11.5.2007, increasing the total education cess to three percent and a total levy of 12.36 percent.
Finance Act, 2007 has imposed service tax on seven new services besides making certain legislative amendments. These include filing of belated returns, revisions of returns, enhancement of exemption scheme limit meant for small services provided from Rs 4 lakhs to Rs 8 lakhs etc. The new taxable services include mining, asset management, designing, content development and supply, execution of works contract, telecommunication and renting to immovable properties on which service tax shall be levied w.e.f 1st June, 2007 vide Notification No. 23/2007-ST. dated 22.5.2007. The Optional Composition Scheme for Works Contracts has also been notified vide Notification No 32/2007-ST. dated 22.5.2007.
Negative List of Services
Budget 2012 totally revamped the taxability provisions of services by accompanying a new system of taxation of services in India. In the new system all services, except those specified in the negative list, will be subject to taxation. Earlier the levy of service tax was based on positive list - specified 119 taxable services. In other words, all services were exempt from service tax except those specifically mentioned. There is also a mega exemption notification wherein 39 services are granted exemption from service tax ( see notification No 25/2012 dated 20-06-2012).
As per clause (34) of section 65B of the Finance Act, 1994, the term "Negative List" means the services which are listed in section 66D.