Miscellaneous

Is service tax applicable on Government contracts?

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Is service tax applicable on Government contracts?

Service Tax is leviable on the value equivalent to the gross amount charged for the works contract less value of the transfer of property in goods involved in the execution of the works contract which is leviable to VAT/ sales tax [Rule 2A of the Service Tax (Determination of Value) Rules, 2006].

Who is exempt from service tax?

Therefore, if the aggregate value of services does not exceed Rs. 10 Lakhs in a financial year, the service provider can claim benefit of this service tax exemption and he won’t be required to pay any service tax on such services.

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Which services are taxable under service tax?

1. Levy of service tax

Sr.No Service Category Date of Introduction
1 Advertising 01.11.1996
2 Air Travel Agent 01.07.1997
3 Airport Services 10.09.2004
4 Architect 16.10.1998

Who is liable for service tax?

05. Person liable to pay service tax The tax is normally payable by the service provider. However law empowers the Government to notify a person other than the service provider to pay the service tax.. In some of the cases liability of payment of service tax has been shifted to the service provider.

Is service tax applicable on infrastructure?

Services provided by sub-contractors to a works contract service (WCS) provider engaged in infrastructure projects will not have to pay service tax — if they are independently classifiable under the WCS — if they are in relation to the infrastructure projects undertaken by the main contractor.

What is the difference between works contract service and construction service?

what is key factor for distinguish between construction service and works contract service? Sh. Paresh Ayadi Ji, KEY FACTOR : In case Construction service is provided with material, it would fall under Works Contract Service and if construction service is provided without material, then only pure labour is involved.

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Is service tax still applicable in India?

So, as per law, Service Tax has been phased out by GST and customers are not supposed to pay it. However, the Service Charge is still applicable.

Who is eligible for service tax registration?

Who should apply for registration under Service Tax law? Every person who has provided a taxable service of value exceeding Rs. 9 lakhs, in the preceding financial year, is required to register with the Central Excise or Service Tax office having jurisdiction over the premises or office of such service provider.

What are the types of service tax?

There are Four GST types namely Integrated Goods and Services Tax (IGST), State Goods and Services Tax (SGST), Central Goods and Services Tax (CGST), and Union Territory Goods and Services Tax (UTGST).

What is service tax discuss the basis of service tax in India?

Service Tax was a tax that was levied by the Central Government of India on the services provided by service providers. This indirect tax came into being under the Finance Act, 1994. It was set at 15\% for transactions that occurred on or after 01 June, 2016.

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What is original work in service tax?

Service tax is payable at composite rate on: 40\% of the value of the original work (original work will include all types of new construction, alteration or additions made to damaged structures) 70\% of the value in case of maintenance work. 70\% in case of all other works contract.

What is the GST rate for Works contract?

GST Rate on Works Contract

Canal, dam, water supply, sewage treatment 18\%
Oil exploration works contract. 18\%
Works contract awarded to the subcontractor by the main contractor, who provides the services mentioned above to the government. 12\%
A road, bridge, canal, or terminal for public use in road transportation. 12\%