Service Tax is an
indirect tax levied on certain services which are
collected by the service provider and later submitted to the Government of
India. The service receiver pays the amount to the service provider who further
pays the amount to the government. So what has
changed have been proposed for service tax rate in recent budget 2017? Well, there
are quite a few changes announced by the finance minister and in this article
will explain the same in a simpler way for you.
Changes in Provisions:
·
In Section 66D, clause
(f) has been omitted, and the service tax exemption on human consumption goods
except alcoholic products will be
continued as general exemption instead.
·
Also, the “process
amounting to manufacture” definition has been omitted from the Section 65B(40)
and has been incorporated into the general
exemption.
·
The definition of
“Authority” mentioned in Clause (E), Section 28 of the Customs Act 1962 has
been modified. The new definition is authority means which have the rights of
advance ruling as mentioned under Section
245-O of the Income Tax Act 1961. Calculate Income Tax Liability on
Income from House Property.
·
The application fees for
the advance ruling has been increased to INR 10,000 from INR 2,500. This
amendment has been introduced into the Section
96C(3) of the Finance Act 1994.
·
The
announce time for declaring ruling of an authority has been increased to 6
months from 90 days. This has been amended under section 96D (6) of the Finance
Act 1994.
·
Also, a
new section referred as 96HA has been introduced which prescribes that
transferring the pending authority ruling applications will be constituted
under the Section 245-O to receive the assent of the president.
·
No
proceeding will be invalidated of any authority due to any defect in the
constitution of the same authority.
Changes in Service Tax Rate Exemptions:
·
The
exemption on taxable services such as import of technology for research and development cess will not be
available. On such services, tax + Swachh Bharat Cess + Krishi Kalyan Cess will
be applicable. The Income Tax Deductions You Can Avail Before It is Too Late.
·
Life
insurance will be non-taxable for the Army, Naval,
and Air Force.
·
The
Service Tax will be exempted from the one-time
payment for long-term lease of immovable
property renting.
·
The
exemption mentioned in S. No. 9B of notification No. 25/2012-ST dated
20.06.2012, has been modified for the “residential”
status. Other than that, all other
exemption will remain same.
The
changes in service tax rate and exemption has been
introduced to strengthen the economic build of the country.
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