What is a service tax Meaning?
Definition: Service tax is a tax levied by the government on service providers on certain service transactions, but is actually borne by the customers. It is categorized under Indirect Tax and came into existence under the Finance Act, 1994.
What is service tax in India with example?
2009 the rate of service tax is 10% on gross value of the taxable service plus 2% Education Cess on the service tax amount and 1% Secondary Higher Education Cess on the service tax amount. Example: Suppose the value of taxable service is Rs. 100. Service tax @10% will be Rs.
What is service tax explain the essential features of service tax in India?
The salient features of levy of service tax are: 1. Scope: It is leviable on taxable services ‘provided’ or ‘to be provided’ by a service provider. The services ‘to be provided’ in future are taxed only if payment in its respect is received in advance.
What is service tax Slideshare?
Service Tax Service tax was introduced in India for the first time in 1994. Service Tax is a tax imposed by Government Of India on services provided in India. The current rate is 12.36% on gross value of the service. 4.
What is service tax give two examples?
The government in turn collects the tax from the service providers. Service tax is a type of indirect tax that one is liable to pay to the government once you consume the taxable services offered by different service providers such as restaurants, cab services, hotels, travel agents, cable providers etc.
What are the uses of service tax?
Service tax was paid to the government in exchange for different services received from service providers. Though the tax was paid by service providers, it was recovered from customers who bought or availed of the taxable services.
How is service taxed India?
Calculation of Service Tax From the 1st of June 2016, service tax is levied at 15% of the value of taxable services under Section 66 of the Service Tax Act. The 15% includes 0.5% Krishi Kalyan Cess and 0.5% Swach Bharat Cess.
What is the purpose of service tax?
Service tax is a type of indirect Tax that you are liable to pay to the government once you. The consumer pays the service tax to the service provider while paying the bill (for example, your restaurant bill has a component of service tax). The government in turn collects the tax from the service providers.
What is the nature of service tax?
Service tax is destination —based consumption tax — Service is a destination based consumption tax, as per CBE & C circular No. 56/5/2003 dated 25-4-2003. No service tax if transaction is sale of goods —Service tax is not leviable on a transaction treated as sale of goods and subjected to levy of sales tax/VAT .
What are the elements of service tax?
Name and address of the service receiver. Name, address and registration number of the service provider. Classification, description as well as taxable service value of the service that is rendered. Payable service tax amount to be mentioned on the invoice.