Key Features of Budget 2012-2013 - Specifically on Service Tax
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Place
of Supply Rules for determining the location of Sevice tax confronts challenges
of its share being below its potential, complexity in tax law, and need to
bring it closer to Central Excise Law for eventual transition to GST.
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Overwhelming
response to the new concept of taxing services based on negative list.
■
Proposal
to tax all services except those in the negative list comprising of 17 heads.
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Exemption
from service tax is proposed for some sectors.
■
Service
tax law to be shorter by nearly 40 per cent.
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Number
of alignment made to harmonise Central Excise and Service Tax. A common
simplified registration form and a common return comprising of one page are
steps in this direction.
■
Revision
Application Authority and Settlement Commission being introduced in Service Tax
for dispute resolution.
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Utilization
of input tax credit permitted in number of services to reduce cascading of
taxes.
■
service
to be put in public domain for stakeholders' comments.
■
Study
team to examine the possibility of common tax code for Central Excise and
Service Tax.
■
New
scheme announced for simplification of refunds.
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Rules
pertaining to point of taxation are being rationalised.
■
To maintain a healthy fiscal situation proposal to raise service tax rate
from 10 per cent to 12 per cent, with corresponding changes in rates for
individual services.
■
Proposals
from service tax expected to yield additional revenue of Rs.18,660 crore
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