Slide 1
Service Tax-Negative List & ExemptionsAjay Babu
BandiM.Com,FCMA,ACA12:09 AM
NEGATIVE LIST SERVICES Section 66DServices by Government / Local
Authority,Services by the Reserve Bank of India,Services by Foreign
Diplomatic Mission,Services in relation of Agriculture,Trading of
goods,Manufacture of goods,
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Discussion of exemptions and negative list General Exemption for
Small Service Providers,Exemptions based on the Status of Service
Provider,Exemptions based on the Status of Service
Receiver,Industry-Wise Exemptions, andMiscellaneous Exemptions
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NEGATIVE LIST SERVICES Section 66DSelling of space or time for
advertisement,Services by way of access to road or bridge,Betting,
Gambling, etc.,Entertainment Events and Amusement
Facilities,Transmission or Distribution of Electricity,Educational
Services
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NEGATIVE LIST SERVICES Section 66DRenting of Residential
Dwelling,Financial Services,Transportation of
passengers,Transportation of Goods,Mortuary Services.
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SMALL SERVICE PROVIDERS12:08 AM
ExemptionAggregate Value of taxable services received / invoices
raised not exceeding `10 Lakhs ( aggregate of all kinds of services
from all premises)
Service Provider will be liable to pay tax only in respect of
payments received / invoices in excess of `10 Lakhs12:08 AM
CENVAT CreditNot available up to specified period /amount (`10
Lakhs)CENVAT Credit Available --after the exemption period /amount
( exceeding `10 Lakhs)Reverse the duty credit in respect of inputs
in stock and inputs in process as on the date on which the he
starts availing exemption benefit Unavailed Credit on the date of
availing exemption will be lapsed12:08 AM
Nature of ExemptionThe exemption benefit is optional, and the
Service Provider can choose not to opt for this exemption.However,
the option once exercised, shall not be withdrawn during the
remaining part of that financial year.
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Nature of ExemptionThe exemption benefit is optional, and the
Service Provider can choose not to opt for this exemption.However,
the option once exercised, shall not be withdrawn during the
remaining part of that financial year.
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EXEMPTIONS FOR SERVICE PROVIDER / SERVICE RECEIVER12:08 AM
SEZs/Units in SEZs
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Special Economic ZoneIt is a zone specified as Special Economic
Zone by the Central Government [u/s 3(1) Proviso Expln. 3(iii) of
CEA, 1944] Special Economic Zone is a specifically delineated area,
considered as an area beyond the territory of India, for the
purpose of Taxes ad Duties12:08 AM
Developer of Special Economic ZoneA person engaged in (i)
Development, or (ii) Operation, or (iii) Maintenance, of an SEZ
Inclusion: Person authorized by the Developer for such
purpose12:08 AM
Nature of Exemption12:08 AMIf Service received areExclusively
used for SEZs authorized operations Not exclusively used for
SEZService Providers DutiesNeed not levy ST in his Invoice raised
on Developer or Unit of SEZ Shall levy ST in his Invoice, collect
and pay to GovernmentRefund of STDoes not ariseST Refunded to
Developer or Unit in SEZ
GOVERNMENT / LOCAL AUTHORITY (Sec.66(a)12:08 AM
Negative ListAll Services received by Government (Central /
State Government / union Territories) or a Local Authority are
covered by Negative List12:08 AM
Services not in Negative List = Taxable ServicesServices by the
Department of posts by way of Speed Post, Express Parcel post, Life
Insurance and Agency Services.> provided to a person other than
Government.Services provided to Government or Local Authority or
Governmental Authority by way of repair or maintenance of an
aircraft is taxable.(Whether it is inside or outside the precincts
of a port or an airport) [Impact: Earlier such service was
exempted].12:08 AM
Services not in Negative List = Taxable ServicesTransport of
Goods or Passengers on charter or hire basis.(Note: If the
transportation is by Stage Carriage or by Railways in specified
class or by Metro / Monorail / tramways or Inland Waterways or
Public Transport in vessel, it is exempt from tax)Other Support
Services provided to business entities.12:08 AM
Services rendered by the Department of Posts12:08 AM
Taxable Services
1.Courier Services (Speed Post)2.Insurance Services(Postal Life
Insurance),3.Agency or Intermediary Services on commission basis
(Distribution of Mutual Funds, Bonds, Passport Applications,
Collection of Telephone & Electricity Bills).NoteThe above
activities are taxable, as they are rendered by other Commercial
entities also12:08 AM
Non- Taxable Services
1. Basic Mail Services known as Postal Services such as Post
card, Inland Letter, Book Post, Registered Post provided
exclusively by the Department of Posts to meet the universal postal
obligations.
2.Transfer of money through Money Orders, Operation of Savings
Accounts, Issue of Postal Orders, Pension Payments and other such
Services.
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RESERVE BANK OF INDIA [Sec. 66D(b)]Negative List: All services
provided or agreed to be provided by the Reserve Bank of India are
not liable for ST
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RESERVE BANK OF INDIA [Sec. 66D(b)]Taxability: The following
services are still liable for Service Tax-a.Any Service provided to
the Reserve Bank of Indiab.Any service provided to the RBI, where
the Service Tax is payable by RBI under reverse charge
mechanism12:08 AM
FOREIGN DIPLOMATIC MISSION [S.66D(C)
Service Provided ToPurposeForeign Diplomatic Mission or Consular
post in India Official Use of such Foreign mission /
ConsulatesDiplomatic Agents or Career Consular Officers or their
family membersPersonal use of such persons
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UNITED NATIONS AND INTERNATIONAL ORGANISATIONSUnited Nations
International Childrens Emergency Fund (UNICEF)United Nations
Educational, Scientific and Cultural Organization (UNESCO)Food and
Agriculture Organizations of the United Nation.World Health
Organization (WHO)International Telecommunication
Union.International Labour Organization (ILO)International Monetary
Fund(IMF)World BankUniversal Postal Union.International Civil
Aviation Organization.
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CHARITABLE TRUSTS
Public HealthAdvancement or religion or spiritualityAdvancement
or educational programmes or skill development for abandoned,
orphaned or homeless children/ physically or mentally abused and
traumatized persons / prisoners/ persons above 65 years residing in
rural area.Preservation of environment including watershed, forests
and wildlife12:08 AM
INDUSTRY-WISE EXEMPTIONS12:08 AM
Agricultural Operations [Sec.66D)]
TRADING / MANUFACTURING ACTIVITIES [Sec.66D(e)]
PROCESSING OF GOODS [Sec.66D(f).]
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ADVERTISEMENT[Sec.66D(g)]
Negative List: Selling of Space or Time Slots for advertisements
are not liable for service tax. This includes the following
activities: a. Advertisements in Newspapers and Journals, i.e.
Print Media,b.Advertisements in Bill Boards, Public Places
(including stadium,)Buildings, Conveyances, Cell Phones, ATMs,
internet, etc.12:09 AM
Taxable ServicesAdvertisements in Radio or Television,Sale of
Time Slot by Broadcasting Organization,Mere Canvassing
advertisement of publishing on a newspaper on commission
basis,Services rendered by Advertisement Agencies relating to
making or preparation of advertisements, facilitation services to
Broadcasting / publishing companies.
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SPORTSPERSON / SPORTS RELATED ACTIVITIESExemption:1.Services
provided by an individual as a Player, Referee, Umpire, Coach or
Team Manager to a recognized Sports Body, in relation to
participation in a sporting event organized by a recognized Sports
Body.2.Services by way of Sponsorship of sporting events12:09
AM
SPORTSPERSON / SPORTS RELATED ACTIVITIESTaxable
Services:a.Services by individuals such as Selectors, Commentators,
Curators and Technical Experts.b.Services by a sports person to any
Franchisee are taxable, since such Franchisee is not a recognized
sports body12:09 AM
AMUSEMENTS PARKS AND OTHER ENTERTAINMENT SER
VICES[Sec.66D(j)]
Negative List: Services of admission to entertainment events /
access to amusement facilities do not attract Service Tax12:09
AM
Taxable ServicesCatering, Transportation, Guest-house Services
provided within the Amusement Park,Membership of a Club, which
enables access to recreational facilities.Input Services provided
by a person like an Event Manager for organizing an Entertainment
Event or by an Entertainer for the providing the entertainment12:09
AM
HEALTH CARE SERVICESExemption:Health Care Services by a Clinical
Establishment, an Authorized Medical Practitioner or
Para-medics.Services by a Veterinary Clinic in relation to health
care of animals or birds.
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PROPERTY RELATED SERVICES (S.66D(m,h)Negative List: The
following activities are exempt from ST Renting or Residential
Dwelling for use as residence.[Sec.66D(m)]Access to a road or
bridge on payment of Toll Charges. [Sec.66D(h)]12:09 AM
TRANSPORTATION OF PASSENGERS[Sec.66D(o)]
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FINANCIAL SERVICES [Sec.66D(n)]
Negative List: Services by way of Extending Deposits, Loans or
Advance, to the extent the consideration is interest or
discount.Sale or purchase of Foreign Currency between 2 or more
Banks, between 2 or more Authorized Dealers or between Banks and
Authorized Dealers12:09 AM
Miscellaneous Services Services Provided by an Advocate (` 10
lakhs)Services by Arbitral Tribunal or Members thereofServices by
an Association of Persons to its MembersExemptions for Intermediary
Services
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Miscellaneous Services Betting, Gambling or Lottery
[Sec.66D(i)]Transmission or Distribution of Electricity a Taxable
Service [Sec.66D(k)]Services provided as part of Supply of Food for
Human ConsumptionExemptions available to Science and Technology
Parks / Units
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