How many services are taxable in india

It took 17 years from then for the Law to evolve. GST has replaced multiple indirect taxes, which were existing under the previous tax regime. The advantage of having one single tax means every state follows the same rate for a particular product or service.

Tax administration is easier with the Central Government deciding the rates and policies. Common laws can be introduced, such as e-way bills for goods transport and e-invoicing for transaction reporting. Tax compliance is also better as taxpayers are not bogged down with multiple return forms and deadlines.

Some taxes were governed by the states and some by the Centre. There was no unified and centralised tax on both goods and services. Hence, GST was introduced. Under GST, all the major indirect taxes were subsumed into one.

It has greatly reduced the compliance burden on taxpayers and eased tax administration for the government. One of the primary objectives of GST was to remove the cascading effect of taxes. Previously, due to different indirect tax laws, taxpayers could not set off the tax credits of one tax against the other.

For example, the excise duties paid during manufacture could not be set off against the VAT payable during the sale. This led to a cascading effect of taxes. Under GST, the tax levy is only on the net value added at each stage of the supply chain. This has helped eliminate the cascading effect of taxes and contributed to the seamless flow of input tax credits across both goods and services.

GST laws in India are far more stringent compared to any of the erstwhile indirect tax laws. Under GST, taxpayers can claim an input tax credit only on invoices uploaded by their respective suppliers. This way, the chances of claiming input tax credits on fake invoices are minimal.

The introduction of e-invoicing has further reinforced this objective. Also, due to GST being a nationwide tax and having a centralised surveillance system, the clampdown on defaulters is quicker and far more efficient. Hence, GST has curbed tax evasion and minimised tax fraud from taking place to a large extent. GST has helped in widening the tax base in India. Previously, each of the tax laws had a different threshold limit for registration based on turnover.

As GST is a consolidated tax levied on both goods and services both, it has increased tax-registered businesses. Besides, the stricter laws surrounding input tax credits have helped bring certain unorganised sectors under the tax net. For example, the construction industry in India.

Previously, taxpayers faced a lot of hardships dealing with different tax authorities under each tax law. Besides, while return filing was online, most of the assessment and refund procedures took place offline. Now, GST procedures are carried out almost entirely online. Everything is done with a click of a button, from registration to return filing to refunds to e-way bill generation.

It has contributed to the overall ease of doing business in India and simplified taxpayer compliance to a massive extent. The government also plans to introduce a centralised portal soon for all indirect tax compliance such as e-invoicing, e-way bills and GST return filing. A single indirect tax system reduces the need for multiple documentation for the supply of goods. GST minimises transportation cycle times, improves supply chain and turnaround time, and leads to warehouse consolidation, among other benefits.

With the e-way bill system under GST, the removal of interstate checkpoints is most beneficial to the sector in improving transit and destination efficiency. Ultimately, it helps in cutting down the high logistics and warehousing costs. Introducing GST has also led to an increase in consumption and indirect tax revenues.

Due to the cascading effect of taxes under the previous regime, the prices of goods in India were higher than in global markets. Even between states, the lower VAT rates in certain states led to an imbalance of purchases in these states. Having uniform GST rates have contributed to overall competitive pricing across India and on the global front.

In that case, the tax was paid by service providers, but recovered from service receivers who purchased or received the taxable services. The service tax in India was imposed under Section 65 of the Finance Act, With the roll-out of the budget of , it came into effect from July 1, , the services that were included under the service tax were increased gradually from They were extended to incorporate services provided by air-conditioned restaurants, lodging both long and short term , guest houses etc.

Furthermore, based on the regulations, the service tax was charged from companies as well as individual providers. While companies could pay it on the basis of accrual, individuals had to pay tax via cash. The tax, however, had to be paid only if the value of the services provided exceeded INR 10 lakh rupees in the single financial year.

This addition to the service tax rules was not applicable to Jammu and Kashmir. As per the previous regulations, the service tax in India was paid on all the services excluding those that were included in the other set of services, namely, the negative list. While all the service providers were liable to pay service tax, including those in the government and private sectors, the main exemptions included the following:.

A service provider of a small scale can avail an exemption if his turnover on the taxable services does not exceed INR 10 lakhs within the same financial year. When some goods and services are received from a service provider, and there is proof indicating that no credit duty has been paid on those goods or materials, while there is written proof of their value, and the fact that the services are rendered as per the CENVAT Credit rules, then the recipients are exempt from paying the service tax on those goods and services.

The service tax is also not applicable to the services that are rendered to diplomatic missions as well as to officers on such mission plus their family members. Some other services that are not taxable include services such as port services, containerised transport services and goods transport services which have been either received by exporters or used for exporting goods.

Here, the service tax which is paid by an exporter on these services is then refunded to the exporter. Any services that are provided to international organizations as well as to the United Nations are not taxable.

This invoice has to be issued in 14 days from the date of completion of the taxable service or the receipt of payment of the service, whichever is earlier. The invoice must have the following:. While the measure is aimed at bringing efficiency by automating the processes, it is anticipated that this would cut down the time and cost of tax payers and also result in a steady increase in more and more assessees adopting this facility.

For taxpayers who opt to maintain account with the concerned bank and willing to use Internet banking facility :. The validation is mandatory and only successful entrants will be allowed to proceed further. This will ensure that the bank is not collecting and accounting indirect tax revenue for a Commissionerate for which it is not authorized. Click here Consolidated instructions on compassionate appointment-Replacement of Para regarding. Click here Reminder-data collection on pending compassionate appointment applications-reg.

Chairman's Desk. Taxpayer Assistance. GST Common Portal. Indian AEO Programme. Public Information. Stakeholder Consultation. Departmental Officers. Till Nil 4. Nil 5. Period Rate of Interest 1. Section Offence Details 1 76 Failure to pay service tax In addition to the service tax and interest, penalty not less than Rs. Failure to keep, maintain or retain records- Up to Rs. Failure to pay tax electronically by the person required to pay tax electronically- upto Rs.

For contravention of any other provisions of the Act where no separate penalty is provided- upto Rs. The reduced penalty is available only if the penalty is paid within 30 days of the date of communication of the order. Levy of service tax 1. The table also shows the 'accounting heads' for each category service, for the purpose of payment of service tax: Sr. Air Travel Agent. Auctioneers' service, other than auction of property under directions or orders of a count of or auction by Central Govt.

Authorized Service Station. Auxiliary to General Insurance. Auxiliary to Life Insurance. Beauty Parlor. Business Auxiliary Service. Business Support Service. Cargo Handling. Chartered Accountant. Cleaning Service. Clubs and Associations. Commercial Training or Coaching. Company Secretary. Construction of Residential Complex. Consulting Engineer. Convention Centre. Cost Accountant. Courier Services. Credit Rating Agency. Custom House Agent. Dry Cleaning. Erection, Commissioning or Installation.

Event Management. Fashion Designer. Franchise Service.