Respected Experts,
It was learnt that service tax is payable by the service provider. In practical whatever service is obtained the service tax is passed on to the service receiver.
Eat at a restaurant, purchase a property or avail any service the bill contains a separate entry for service tax and is paid by the receiver of service. Almost all the times the service tax will be on the whole amount without any credit to the input services/goods.
Is it correct to accept this?
If taxes are collected from the receiver and then paid to government there will be a difference in actual taxes to be paid as the service provider keep the whole amount received for his service, but as per law the tax should be on the amount received by him.
For example if value of service is 100 and tax to be paid is 12.36 then the amount earned by the supplier should be 100-12.36 = 87.64. But since the 12.36 is received from customer and paid to government he whole 100 is with the service provider.
Further if the service provider is eligible for input services exemption then the actual amount will be much lesser than the 12.36.
Please comment.
Thankfully yours
R.Vijayaraghavan
CAclubindia
