Service tax on sale of space in newspaper

well in my view

WEF 01.07.2012, after the introduction of negative list, seling of space in print media for advertisement is exempted from ST.

So there has to be no service tax at all

selling of space or timeslots for advertisements other than advertisements broadcast by radio or television is exempt from service tax.

Pooja and Sweta,

Thanks for your responses. I know that sale of space in print media is in negative list. But the query is on commission earned by the agent from print media , ie newspaper which is liable to service tax. . The agent states that service tax on commission earned by them from newspaper is to be collecetd from the advertiser. That is the practice. But how can it be so? The advertiser doe snot pay the commission - so why serviec tax thereon.

Regards,

The normal trade practice is that the advertising agent retains 15% of total amount and that is regarded as commission. Service tax is applicable on it and there are few judgments as well. According to me the advertising agent should consider the commission as inclusive of service tax and pay service tax by back calculation.

However, the issue is to whom is the advertising agent is providing service is to the newspaper or from the person who gives the payment.

@ Mr.Nirav Worah,

The rule says service tax is collectable and hence the agent is collecting service tax 12.36% on commission.  But should it be collected from the advertiser? It would  be proper if Newspaper company bear it.    Can u quote some case laws?     

rengaraj r.k

can i get that communication copy, my mail id is ymrisvi @ gmail.com

Dear CA Mazumdar,

The circular is not available on the cbec web site.

In normal course though the negative list covers only the advertisement in print media. The marketing services are however liable and this is not on reverse charge.

We provide text news to newspapers. 

Being a news agency, inter alia, engages in collection and dissemination of news story/items and being the author thereof holds copyright in the news story/items such being original literary work in terms of the Copyright Act, 1957. We are the author/owner and has the exclusive right to use our work over the news story/items, reproduce features there of in any imitated form directely or indirectely.

Literary work is in negative list.

Notification No. 25/2012-Service Tax

15. Temporary transfer or permitting the use or enjoyment of a copyright covered under clauses (a) or (b) of sub-section (1) of section 13 of the Indian Copyright Act, 1957 (14 of 1957), relating to original literary, dramatic, musical, artistic works or cinematograph films;

Does it mean we are exempted from service tax? Please reply it is very important.

Thanks