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application of service tax

Queries 778 views 3 replies

Dear Fellows

we have a business of out bound tour where we collected money in INR and paid in foreign currency.

and we provide services like Air ticket, hotel arrangment,visa fee etc

now tne question : what is the service tax application.and in which section it applicable

thanks

Replies (3)

Dear Ajit

As per you statement your services is covered under "TOUR OPERATOR SERVICES". So you should get registered by applying in form ST-1 and you the certificate in form ST-2 ...............

The section apllies on you is  Sec 65

Dear Mr.Gupta & all

Thanks for your response but the circuler no.st-56/5/2003 dt.24-4-2003 the CBEC Clarified inter alia as follows

1.service tax is a destination -based consumption tax it is not applicable on export of service.

2.export of services would continue to be tax free even after the withdrawal of exemption on payment received in foreign exchange wef 1.3.2003

the clarification was reiterated by the cbec in its faq also ,wherein the cbec observed that "if the service are consumed abroad it is covered under export and therefore not liable to service tax .

Again i am clearify the business : we are providing foreign tour to indian clent not vis a vis

in lay man lenguage we sent people to visit abroad from india.

openion solicited

ajit

 

Mr. Ajit... service provided by you falls under the category of TOUR OPERATOR which is classified under section 65(105)(n) of the service tax law. As per Export of Service Rules, services provided by you are treated as export if the services performed, wholly or partly outside India. As per your explanation, the services are performed by you outside India, atleast in part. Thus, the same is exempt.


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