What amount Service Tax Charged on Advertise Agency

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bhavin shah (Querist)
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18 June 2010 Dear Sir,

My own Advertise Agency in Gujarat. I Collect advertise from my client(s) and this advertisement give to Local NewsPaper.

My question is that At what amount service tax charged?

E.g. For one advertise Rs. 8000 Rate charged by Local NewsPaper to our agency & Our agency charge 10000 Rs. Rate to Customer. At same time some Discount given to customer (depend on customer discount given) say rs. 500. In our bill Service Tax charged on Rs. 10,000 or Rs. 9500(after Discount).

Earlier our Practice to charged service tax on Rs.9500 but after Service Tax Department Assessment, Department said that We have charged service tax on Gross amount Say Rs. 10,000. Is it true?

Reply on this above said issue by Expert is service tax charged on gross amount but i give discount to all my client depends on size of advertisement.

Can i give to my client credit note, so, that i have liability on net amount which collected from my client.

Regards,
Bhavin Shah

CA Ashok Kumar Sahu

CA Ashok Kumar Sahu (Expert)
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19 June 2010 YES, SERVICE TAX IS CHARGEABLE ON GROSS BILL AMT.

CMA Arif Farooqui

CMA Arif Farooqui (Expert)
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27 June 2010 on gross bill amount

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