The Finance Minister Shri Arun Jaitley while presenting the Budget announced in the Lok Sabha steps to broaden the Tax Base that will maximize benefits to the economy.
The Service Tax rate is being increased from 12% plus Education Cesses to 14%. The new service tax rate shall subsume the ‘Education Cess’ and ‘Secondary and Higher Education Cess’. Additionally the Service Tax Negative List has been reviewed to include Service Tax to be levied on the service provided by way of access to amusement. Service Tax to be levied on service by way of carrying out any processes as job work for production or manufacture of alcoholic liquor for human consumption. All service provided by the Government to business entities, unless specifically exempt, shall become taxable.
An Excise duty of 2% without CENVAT credit or 6% with CENVAT credit is being levied on condensed milk put up in unit containers. Excise duty of 2% without CENVAT credit of 6% with CENVAT credit is being levied on peanut butter.
The General Exemption under Service tax has been reviewed. Exemption to construction, erection, commissioning or installation of original works pertaining to an airport or port is being withdrawn. Exemption to services provided by a performing artist in folk or classical art forms will be limited only to such cases where amount charged is upto Rs 1,00,000 per performance (except brand ambassador). Exemptions to transportation of ‘food stuff’ by rail, or vessels or road will be limited to transportation of food grains including rice and pulses, flours, milk and salt only. Transportation of agricultural produce is separately exempt which would continue.
Exemptions are also being withdrawn on the following services: (a) services provided by a mutual fund agent to a mutual fund or assets management company (b) distributor to a mutual fund or AMC (c) selling or marketing agent of lottery ticket to a distributor of lottery (d) Departmentally rum public telephone (e) Guaranteed public telephone operating only local calls and (f) Service by way of making telephone calls from free telephone at airport and hospital where no bill is issued
Existing exemption notification for service provided by a commission agent located outside India to an exporter located in India is being rescinded.Tags : Others