Service Tax on Shipping Company Bill.

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JAY GUPTA (Querist)
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13 September 2016 A Chinese CHA has issued us a shipping invoice for shipping goods from China to India. They do no have any office in India Will RCM be applicable.

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Arun Kumar Singh

Arun Kumar Singh (Expert)
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13 September 2016 yes, you need to pay service tax on it. Any taxable services taken in taxable territory from non-taxable territory then service recipient are liable to pay service tax.

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JAY GUPTA

JAY GUPTA (Querist)
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14 September 2016 As this is a bill for Shipping the goods from China to India, is there any exemption available or do we have to pay service tax on full 15%.

Aashok Kumar Sharma online

Aashok Kumar Sharma online

(Expert)
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24 July 2025 Here's the situation regarding **service tax on shipping services from a foreign CHA (Customs House Agent)** with no Indian presence:

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### 1. **Is Reverse Charge Mechanism (RCM) applicable?**

Yes.

* When you take a taxable service from a service provider located outside India (no Indian presence), and the place of service is in India, **the service recipient (you) is liable to pay service tax under RCM**.

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### 2. **Is shipping service taxable and at what rate?**

* **Shipping services related to international goods transportation are generally exempt from service tax in India**.
* However, **Customs House Agent (CHA) services** (clearing and forwarding agent services) are **taxable under service tax**, and if provided by a foreign CHA without Indian presence, the recipient pays under RCM.

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### 3. **Exemptions or special rates?**

* If the invoice is purely for **transportation of goods by sea or air from outside India to India**, **the transportation service itself is exempt** from service tax.
* If the invoice is for **CHA services (customs clearance, documentation, etc.)**, those services are taxable at the standard rate (which used to be 15%, later revised to 14%, 14.5%, and now subsumed under GST, but for the context, 15% was applicable).
* So, **on pure shipping/transportation service, no service tax**.
* On CHA services, **service tax @15% is payable on RCM basis**.

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### **Summary for your case:**

* If the bill is purely **shipping/transportation charges from China to India**, **service tax is exempt** → no tax to be paid.
* If the bill includes **CHA or other taxable services** (like documentation, customs clearance, etc.), then **service tax @15% under reverse charge is payable** by you.

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Would you be able to share the invoice details or the description of services billed? That would help in confirming the applicability more precisely.

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