{"id":581,"date":"2015-11-21T11:56:20","date_gmt":"2015-11-21T11:56:20","guid":{"rendered":"http:\/\/carajput.com\/blog\/?p=581"},"modified":"2021-08-18T17:00:14","modified_gmt":"2021-08-18T11:30:14","slug":"effective-rate-of-service-tax-w-e-f-15-11-2015-14-5","status":"publish","type":"post","link":"https:\/\/carajput.com\/blog\/effective-rate-of-service-tax-w-e-f-15-11-2015-14-5\/","title":{"rendered":"Effective Rate of Service Tax w.e.f.\u00a015.11.2015"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_58 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Page Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-69d2d20960cb6\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #000000;color:#000000\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #000000;color:#000000\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-69d2d20960cb6\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/carajput.com\/blog\/effective-rate-of-service-tax-w-e-f-15-11-2015-14-5\/#Effective_Rate_of_Service_Tax_wef_15112015_145\" title=\"Effective Rate of Service Tax w.e.f.\u00a015.11.2015:\u00a014.5%\">Effective Rate of Service Tax w.e.f.\u00a015.11.2015:\u00a014.5%<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/carajput.com\/blog\/effective-rate-of-service-tax-w-e-f-15-11-2015-14-5\/#For_your_reference_the_published_Notification_is_as_follows\" title=\"For your reference the published Notification is as follows:\">For your reference the published Notification is as follows:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/carajput.com\/blog\/effective-rate-of-service-tax-w-e-f-15-11-2015-14-5\/#1_Whether_SBC_is_applicable_to_all_the_Services\" title=\"1. Whether SBC is applicable to all the Services?\u00a0\">1. Whether SBC is applicable to all the Services?\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/carajput.com\/blog\/effective-rate-of-service-tax-w-e-f-15-11-2015-14-5\/#2_What_would_be_effective_rate_of_service_tax_post_introduction_of_SBC\" title=\"2. What would be effective rate of service tax post introduction of SBC?\u00a0\">2. What would be effective rate of service tax post introduction of SBC?\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/carajput.com\/blog\/effective-rate-of-service-tax-w-e-f-15-11-2015-14-5\/#3_Whether_SBC_needs_to_be_collected_and_paid_separately_from_service_tax_or_subsumed_in_existing_service_tax_rate\" title=\"3. Whether SBC needs to be collected and paid separately from service tax or subsumed in existing service tax rate?\u00a0\">3. Whether SBC needs to be collected and paid separately from service tax or subsumed in existing service tax rate?\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/carajput.com\/blog\/effective-rate-of-service-tax-w-e-f-15-11-2015-14-5\/#4_What_would_be_rate_of_tax_where_services_are_provided_before_and_after_imposition_of_SBC\" title=\"4. What would be rate of tax where services are provided before and after imposition of SBC?\u00a0\">4. What would be rate of tax where services are provided before and after imposition of SBC?\u00a0<\/a><\/li><\/ul><\/nav><\/div>\n<h2 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"Effective_Rate_of_Service_Tax_wef_15112015_145\"><\/span><span style=\"color: #000080;\"><strong>Effective Rate of Service Tax w.e.f.\u00a015.11.2015:\u00a014.5%<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p style=\"text-align: justify;\"><a href=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2015\/11\/Untitled50A.png\" rel=\"attachment wp-att-1671\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-1671\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2015\/11\/Untitled50A-300x180.png\" alt=\"Untitled50A\" width=\"781\" height=\"469\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2015\/11\/Untitled50A-300x180.png 300w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2015\/11\/Untitled50A.png 549w\" sizes=\"(max-width: 781px) 100vw, 781px\" \/><\/a>I would like to inform you that consequent upon issuance of\u00a0Notification No. 22\/2015-Service <a href=\"https:\/\/carajput.com\/blog\/taxes-on-income-received-from-blogging-under-income-tax\/\">Tax<\/a> the Central Government has imposed Swachh Bharat Cess on all taxable services @ 0.50% which is over and above existing rate of service tax @ 14% eventually making effective rate of service tax @ 14.50% on all services rendered\u00a0and\/or all invoices raised\u00a0on or after 15.11.2015. Government has issued notification no.21\/2015 levying Swachh Bharat Cess (\u201cSBC\u201d) at the rate of 0.50% effective 15<sup>th<\/sup>\u00a0November, 2015. Therefore the effective rate of service tax stands increased to 14.50% w.e.f. 15<sup>th<\/sup>\u00a0November, 2015 from existing 14%. However it has been clarified that\u00a0SBC\u00a0shall not be applicable on exempted or services covered in the negative list of services. We have compiled a questionnaire on this for your information and smooth application of enhanced rate of service tax <span style=\"color: #ff6600;\">(<strong><span style=\"text-decoration: underline;\">effective 15<sup>th<\/sup>\u00a0November, 2015<\/span><\/strong>):<\/span><\/p>\n<h2 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"For_your_reference_the_published_Notification_is_as_follows\"><\/span><span style=\"color: #008000;\"><strong>For your reference the published Notification is as follows:<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p style=\"text-align: justify;\">Notification No. 22\/2015-Service Tax G.S.R. &#8212;(E).- In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994) read with sub-section (5) of section 119 of the Finance Act, 2015 (20 of 2015), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts all taxable services from payment of such amount of the Swachh Bharat Cess leviable under sub-section (2) of section 119 of the said Act, which is in excess of Swachh Bharat Cess calculated at the rate of 0.5 percent. of the value of taxable services:<br \/>\nProvided that Swachh Bharat Cess shall not be leviable on services which are exempt from service tax by a notification issued under sub-section (1) of section 93 of the Finance Act, 1994 or otherwise not leviable to service tax under section 66B of the Finance Act, 1994.This notification shall come into force from the 15th day of November, 2015. <span style=\"color: #ff6600;\"><strong>[F.No. 354\/129\/2015 &#8211; TRU]<\/strong><\/span><\/p>\n<h2 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"1_Whether_SBC_is_applicable_to_all_the_Services\"><\/span><span style=\"color: #008000;\"><strong>1. Whether SBC is applicable to all the Services?\u00a0<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p style=\"text-align: justify;\">Yes &#8211;\u00a0Initially at the time of issuance of Finance Budget 2015, there were indications that SCB would be imposed on few selected services. However the notification issued by government has provided that it shall apply on all the services except the following:<\/p>\n<ul style=\"text-align: justify;\">\n<li>Negative List of Services under Section 66D of the Finance Act<\/li>\n<li>Services exempted by a notification issued under sub-section (1) of Section 93 of the Finance Act, 1994 i.e.<\/li>\n<\/ul>\n<p style=\"text-align: justify;\">&#8211;\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Mega Exempted Services vide Notification No. 25\/2012-ST dated June 20, 2012.<\/p>\n<p style=\"text-align: justify;\">&#8211;\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Services exempted as specified to certain extent under the Abatement Notification No. 26\/2012-ST dated \u00a0June 20, 2012.<\/p>\n<h2 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"2_What_would_be_effective_rate_of_service_tax_post_introduction_of_SBC\"><\/span><span style=\"color: #008000;\"><strong>2. What would be effective rate of service tax post introduction of SBC?\u00a0<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p style=\"text-align: justify;\">Effective rate of service tax post introduction of SBC would be 14.5%.<\/p>\n<h2 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"3_Whether_SBC_needs_to_be_collected_and_paid_separately_from_service_tax_or_subsumed_in_existing_service_tax_rate\"><\/span><span style=\"color: #008000;\"><strong>3. Whether SBC needs to be collected and paid separately from service tax or subsumed in existing service tax rate?\u00a0<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p style=\"text-align: justify;\">SBC would be levied, charged, collected and paid to government independent of service tax. This needs to be charged separately on the invoice, needs to be accounted separately in the books of account and needs to be paid separately under separate accounting code which may be notified separately.<\/p>\n<h2 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"4_What_would_be_rate_of_tax_where_services_are_provided_before_and_after_imposition_of_SBC\"><\/span><strong><span style=\"color: #008000;\">4. What would be rate of tax where services are provided before and after imposition of SBC?<\/span>\u00a0<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p style=\"text-align: justify;\">The impact of introduction of SBC on different situations is summarized below. (assuming that applicable rate is determined as per Rule 4 of Point of Taxation Rules, 2011)<\/p>\n<table width=\"631\">\n<tbody>\n<tr>\n<td colspan=\"4\" width=\"631\"><span style=\"color: #008000;\"><strong>Impact of imposition of Swachh Bharat Cess<\/strong><\/span><\/td>\n<\/tr>\n<tr>\n<td width=\"182\"><span style=\"color: #008000;\"><strong>Service provided<\/strong><\/span><\/td>\n<td width=\"180\"><span style=\"color: #008000;\"><strong>Invoice issued<\/strong><\/span><\/td>\n<td width=\"142\"><span style=\"color: #008000;\"><strong>Payment received<\/strong><\/span><\/td>\n<td width=\"128\"><span style=\"color: #008000;\"><strong>Rate<\/strong><\/span><\/td>\n<\/tr>\n<tr>\n<td width=\"182\">Before\u00a015-11-15<\/td>\n<td width=\"180\">On or After\u00a015-11-15<\/td>\n<td width=\"142\">On or After\u00a015-11-15<\/td>\n<td width=\"128\">14.50%<\/td>\n<\/tr>\n<tr>\n<td width=\"182\">Before\u00a015-11-15<\/td>\n<td width=\"180\">Before\u00a015-11-15<\/td>\n<td width=\"142\">On or After\u00a015-11-15<\/td>\n<td width=\"128\">14.00%<\/td>\n<\/tr>\n<tr>\n<td width=\"182\">Before\u00a015-11-15<\/td>\n<td width=\"180\">On or After\u00a015-11-15<\/td>\n<td width=\"142\">Before\u00a015-11-15<\/td>\n<td width=\"128\">14.00%<\/td>\n<\/tr>\n<tr>\n<td width=\"182\">On or After\u00a015-11-15<\/td>\n<td width=\"180\">Before\u00a015-11-15<\/td>\n<td width=\"142\">On or After\u00a015-11-15<\/td>\n<td width=\"128\">14.50%<\/td>\n<\/tr>\n<tr>\n<td width=\"182\">On or After\u00a015-11-15<\/td>\n<td width=\"180\">Before\u00a015-11-15<\/td>\n<td width=\"142\">Before\u00a015-11-15<\/td>\n<td width=\"128\">14.00%<\/td>\n<\/tr>\n<tr>\n<td width=\"182\">On or After\u00a015-11-15<\/td>\n<td width=\"180\">On or After\u00a015-11-15<\/td>\n<td width=\"142\">Before\u00a015-11-15<\/td>\n<td width=\"128\">14.50%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p style=\"text-align: justify;\"><span style=\"color: #008000;\"><strong>5. Whether SBC paid on input service would be eligible as credit?\u00a0<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\">There is no amendment in the Cenvat Credit Rules, 2004 regarding a ailment and utilization of SBC. In the absence of the same, credit would not be admissible. However industry is expecting clarification on this from CBEC.<\/p>\n<p style=\"text-align: justify;\">The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Hope the information will assist you in your Professional\u00a0endeavors. For query or help, contact:\u00a0<a href=\"mailto:singh@carajput.com\">singh@carajput.com<\/a>\u00a0\u00a0or call at 9555555480<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Effective Rate of Service Tax w.e.f.\u00a015.11.2015:\u00a014.5% I would like to inform you that consequent upon issuance of\u00a0Notification No. 22\/2015-Service Tax the Central Government has imposed Swachh Bharat Cess on all taxable services @ 0.50% which is over and above existing rate of service tax @ 14% eventually making effective rate of service tax @ 14.50% &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[150],"tags":[2651,3588,2902,3587,3586,3589],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/581"}],"collection":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/comments?post=581"}],"version-history":[{"count":5,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/581\/revisions"}],"predecessor-version":[{"id":16170,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/581\/revisions\/16170"}],"wp:attachment":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/media?parent=581"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/categories?post=581"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/tags?post=581"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}