Swachh Bharat cess on services to be notified later: FM

The Swachh Bharat 2% cess on var­i­ous ser­vices will be noti­fied at a lat­er date although the high­er rate of 14% Ser­vice Tax will take effect from June 1, the­Fi­nance Min­istry said today.

“…the date of giv­ing effect to the pro­vi­sions relat­ing to impo­si­tion of aSwachh Bharat cess on all or any tax­able ser­vice will be done in due course,” said an offi­cial release.

Resources gen­er­at­ed from this cess will be utilised for financ­ing and pro­mot­ing ini­tia­tives towards Swachh Bharat.

Finance Min­is­ter Arun Jait­ley in his bud­get announced rais­ing the ser­vice tax rate from 12 per cent to 14 per cent and levy­ing of 2% Swachh Bharat cess on all or select ser­vices to fund clean­li­ness drive.

“The Finance Bill, 2015 has since been enact­ed and the Cen­tral Gov­ern­ment has noti­fied June 1, 2015 as the date from which the rate of 14% would become applic­a­ble,” said the release.

It fur­ther said that the pro­vi­sion of edu­ca­tion cess and sec­ondary and high­er edu­ca­tion cess would be sub­sumed in the ser­vice tax with effect from June 1.

Cur­rent­ly, the ser­vice tax inci­dence works out to be 12.36% after tak­ing into account var­i­ous cesses.

Besides, the increase in the tax rate cer­tain oth­er pro­ce­dur­al changes would come into play from next month.

Ser­vice tax is levied on all ser­vices, expect a small neg­a­tive list.

Adver­tis­ing, air trav­el, ser­vices of archi­tect, cer­tain type of con­struc­tions, cred­it card, even man­age­ment, mon­ey chang­ing activ­i­ties, insur­ance, and tour oper­a­tor are some of the impor­tant ser­vices which attract tax.

Source: Dnain­dia