Abatement of service tax bar sales and hotel room sales

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Kalyan Chakravarthy Sadhu (Querist)
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25 May 2013 Hi ...

One of our client is resort.
In resort there is seperate bar Counter and Room Sales..
But there are collecting Service tax on above two counters not 12.36%.
Is there any abatement on Service tax on bar sales and Room sales..

CA Vikas Acharya

CA Vikas Acharya (Expert)
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25 May 2013 see notification 26/2012
bundled service. (specially for situations similar to you)
tax to be payable on 70% of total value, 30% abatement.

means exact tax is 8.652% of the bill value.

Kalyan Chakravarthy Sadhu

Kalyan Chakravarthy Sadhu (Querist)
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25 May 2013 Hi vikas..
but our clint providing service tax 30% on Bar sales( abatement 70%)

on room sales service tax 50% (abatement 50%)

Is it correct..

Ashish Vaish

Ashish Vaish (Expert)
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25 May 2013 W.e.f 01-07-2012, Service tax on Bar Sales shall be on 40% of Gross Value. (4.944 effectively). Service Tax on room sales shall be on 60% of Gross Value. (7.416 % effectively).
In case of service of food in rooms it shall also be liable to service tax on 40% of Gross Value of fooding in the bill.

Kindly check the period of dispute. The abatement you have mentioned was existing prior to 2012.

Kalyan Chakravarthy Sadhu

Kalyan Chakravarthy Sadhu (Querist)
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27 May 2013 Thank u Ashish...

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