Tax exemption over specific services
The finance ministry has provided service tax exemption over certain services provided by the government or local authorities. The services are certain registration process where the amount to be paid does not exceed INR 5,000 if service is obtained on a regular basis the annual payment limit is 5,000. The budget made provisions to collect service tax from business entities with more than 10 lakh. The service tax charged is at 15 percent for the services offered by local or government authorities. Contact Uptra Consultancy Services for Company registration and Tax Consultancy Services.
The list of services exempt from tax are availing a passport, visa, drivers license and birth or death certificate, legal registrations( vehicle ), certifications for safety. Services related to approval change of status of land building approval. Fines or penalties will also be exempt from service tax. Service tax will not levied on individuals for obtaining these services from government or local authorities. Telecoms get a major relief as they are exempt from paying service tax over spectrum obtained before April 2016. For spectrum obtained after April 2016 tax will be paid under deferred payment scheme in installments. The telecom will pay service tax on the day of installment if opted for deferred payment for 10 years.
Business organizations can also claim input tax credit over service tax or excise, provided that the services are under non-exempt services list. Input tax credit can be availed over the life-time of the spectrum , that is 20 years. These provisions bring the much required clarity over service tax queries in spectrum usage.