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Negative List of Services and Exempted Services

1. Corporate Knowledge Foundation Presents A Knowledge Workshop On New Regime of Service Taxation in India Conducted by Dr. Sanjiv Agarwal FCA, FCSSaturday,14th July,2012New Delhi Dr. Sanjiv Agarwal 2. Corporate Knowledge Foundation SESSION - IINegative List of Services & Exempted Services 2 3. Scope of Service TaxServices on which Service Tax shall be attractedcomprise of : Those services which satisfy the definition of service u/s 65B (44) Nine specified declared services u/s 66E Those services which do not find place in negative list of services u/s 66D Those services which are not exempt from levy of Service Tax under Notification No. 25/2012-ST dated 20.06.2012 to be contd. 3 4. Scope of Service TaxServices on which no Service Tax shall be payable comprise of: Service which are specifically excluded from the scope of definition of service itself u/s 65(44). 17 broad services specified in the negative list of services u/s 66D. Services which are exempt from levy of Service Tax under N. No. 25/2012-ST dated 20.06.2012. Specified services otherwise exempt under specific notifications. Activities where service provider and service receiver are in non taxable territory 4 5. Examples of new activities which may be taxed Non commercial construction for nongovernment purpose Private roads Residential construction of more than one unit Commercial artists/performers Actors, directors Reality show judges Tourism boats Board directors sitting fee Non-compete fee Arbitrators to business entities Banking services to government Unrecognized IPRs to be contd.. 5 6. Examples of new activities which may be taxed Discourses and lectures Services to RBI Hotel Telephone Calls Matrimonial sites Astrologers 6 7. Negative list of ServicesWhat is negative list Defined in new section 66D Section 66D Specifies seventeen 17 broad categories of services. Effective from 1-7-2012 If an activity meets the charactertics of service , it is taxable unless specified in Negative List. Based on socio-economictax criterion 7 8. Consideration in Negative ListSocio Economic Considerations in Negative list Administrative considerations: taxation of Government, difficult to tax sectors e.g. marginbased financial services. Under contractual obligations: Specified international bodies and diplomatic missions Welfare considerations: welfare of vulnerable sections of society, essential education, public health; public transport, services by non-profit entities, religious services, promotion of art, culture and sports. Economic considerations: transport of export goods, services meant for agriculture, animal husbandry and infrastructure development. Explicit activities in the nature of services, which are within the taxing powers of States: betting and lotteries, tolls. 8

9. Sectors in Negative ListNegative list of services is drawn from seven sectors, viz. services provided by specified person ie, Government social welfare & public utilities financial sector transportation construction & real estate education health care others & miscellaneous 9 10. Services by Government or a local authorityServices by Government or a local authority excluding the followingservices to the extent they are not covered elsewhere: Services 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 in relation to an aircraft or a vessel, inside or outside the precincts of a port or an airport; Transport of goods or passengers; or Support services provided to business entities to be contd.. 10 11. Service provided by Government or Local Authority Most of services provided by Central / State Governments exempt from service tax. But following services are taxable Department of posts - speed post, express parcel, life insurance and agency service to non government business entity but basic mail, money orders, operation of saving accounts ,pension payment etc services are covered in negative list In relation to vessel or aircraft service within/outside port/airport Transport of goods and/ or passengers Support service to business entities To be contd.. 12. Service provided by Government or Local Authority Services by government as sovereign functions (grant of licensing rights or audit of government, passport etc.) Excludes corporations formed under Central Acts or State Acts or various Government companies registered under Companies Act, 1956 or autonomous institutions set up by a Special Acts Government Department needs to be registered and to pay tax on support services of Renting of immovable properties Speed post, express parcel, life insurance. Transport of goods and/ or passengers Services in relation to vessel or aircraft For other services, government not liable to pay service tax as tax paid by service recipient in reverses charge (N. No. 30) To be contd.. 13. Service provided by Government or Local AuthoritySupport services" means infrastructural, operational, administrative, logistic, marketing or any other support of any kind comprising functions that entities carry out in ordinary course of operations themselves but may obtain as services by outsourcing from others for any reason whatsoever shall include advertisement and promotion, construction or works contract, renting of immovable property, security, testing and analysis; Services provided by Government Security agencies are covered under support service - under reverse charge, Service Receiver is liable to tax. 14. Service by Reserve Bank of India All services provided by RBI are in Negative List Service Provided to RBI is taxable unless covered in negative list. Service provided by banks to RBI taxable unless covered in Negative List or exempted services 15. Services by a foreign diplomatic mission located in India Services by diplomatic mission of any country located in India Does not cover services provided by any office or establishment of an International organization (Section 3 of United Nation Privileges & Immunities Act 1947) Example- UNESCO, UNICEF, IMF, IBRD etc Notification No. 27/2012-

ST dated 20.6.2012 conditionally exempts service provided by any person for the official use of a provision of a foreign diplomatic mission or consular post in India for personal use or use of the family member of diplomatic agents or career consular officers posted in India

16. Service relating to Agriculture or Agricultural Produceservices relating to agriculture by way of (i) agricultural operations directly related to production of any agricultural produce including cultivation, harvesting, threshing, plant protection or seed testing; (ii) supply of farm labour; (iii) processes carried out at an agricultural farm including tending, pruning, cutting, harvesting, drying, cleaning, trimming, sun drying, fumigating, curing, sorting, grading, cooling or bulk packaging and such like operations which do not alter the essential characteristics of agricultural produce but make it only marketable for the primary market; (iv) renting or leasing of agro machinery or vacant land with or without a structure incidental to its use; (v) loading, unloading, packing, storage or warehousing of agricultural produce; (vi) agricultural extension services; (vii) services by any Agricultural Produce Marketing Committee or Board or services provided by a commission agent for sale or purchase of agricultural produce; to be contd 17. Service relating to Agriculture or Agricultural ProduceThe Services relating to agriculture or agricultureproduce specified in negative list- agricultural operations directly related to production of any agricultural produce including cultivation, harvesting, threshing, plant protection or seed testing; supply of farm labour; processes carried out at the agricultural farm including tending, pruning, cutting, harvesting, drying cleaning, trimming, sun drying, fumigating, curing, sorting, grading, cooling or bulk packaging and such like operations which do not alter essential characteristics of agricultural produce but makes it only marketable for the primary market not for retail market; (e.g. cleaning of Wheat) to be contd . 18. Service relating to Agriculture or Agricultural Produce renting of agro machinery or vacant land with or without a structure incidental to its use (e.g. green house, storage shed.) loading, unloading, packing, storage and warehousing of agricultural produce; agricultural extension services (application of scientific research, farmer education & training) services provided by any Agricultural Produce Marketing Committee or Board (APMC) for agriculture or agricultural produce but does not include non -agricultural activities (e.g. renting of shops or other property or services provided by commission agent for sale or purchase of agricultural produce) to be contd . 19. Service relating to Agriculture or Agricultural ProduceAgriculture -Section 65 B(3) Cultivation of plants and rearing of all life-forms of animals except the rearing of horses, for food, fiber, fuel, raw material or other similar productsAgriculture Produce -Section 65B(5) any produce of agriculture on which either no further processing is done or such processing is done as is usually done by a cultivator or producer which does not alter its essential characteristics but makes it marketable for primary market (E.g. Plantation crops like rubber, tea or coffee but does not include potato chips or tomato ketchup) to be contd . 20. Trading of Goods Trading of goods is not a taxable service, it being a sale and not a service. If a transaction is a sale, it is not a service and vice versa Transfer of title in goods

is crucial Activities of a commission agent / clearing and forwarding agent who sells goods on behalf of another for a commission are not trading of goods (Title of goods does not pass) Forward contracts are in the nature of trading of goods. Future contracts are not trading of goods to be contd .

21. Trading of GoodsGoods - Section 65B(25) goods" means every kind of movable property other than actionable claim and money includes securities, growing crops, grass, and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale 22. Process amounting to manufacture or production of goods process amounting to manufacture or production of goods" means a process on which duties of excise are leviable under section 3 of the Central Excise Act, 1944 or any process amounting to manufacture of alcoholic liquors for human consumption, opium, Indian hemp and other narcotic drugs and narcotics on which duties of excise are leviable under any State Act for the time being in force. Covers manufacturing activity carried out on contract or job work basis where Transfer of title of goods is not involved Duties of excise are leviable on such process 22 23. What is Excisable Goods excisable goods means goods specified in the First Schedule and the Second Schedule to the Central Excise Tariff Act, 1985 as being subject to a duty of excise and includes salt Mobility and marketability are essential conditions Goods includes any article, material or substance which is capable of being bought and sold for a consideration and such goods shall be deemed to be marketable. 24. Exemption Service - Clause 30Carrying out an intermediate production process as job work in relation to-(a) agriculture, printing or textile processing;(b) cut and polished diamonds and gemstones; or plain and studdedjewellery of gold and other precious metals, falling under Chapter 71 ofthe Central Excise Tariff Act ,1985 (5 of 1986)(c) any goods on which appropriate duty is payable by the principalmanufacturer or(d) processes of electroplating, zinc plating, anodizing, heat treatment,powder coating, painting including spray painting or auto black, during thecourse of manufacture of parts of cycles or sewing machines upto anaggregate value of taxable service of the specified processes of onehundred and fifty lakh rupees in a financial year subject to the conditionthat such aggregate value had not exceeded one hundred and fifty lakhrupees during the preceding financial year 25. Selling of space or time slots for advertisementsSelling of space or time slots for advertisements other thanadvertisements broadcast by radio or televisionThis entry in negative list should qualify the following tests involves selling of space (in case of print media) involves selling of time slots ( in case of electronic media) purpose of selling time slots / space to be for advertisements (publicity / sales promotion, awareness etc.) excludes broadcast by radio or television ( i.e. broadcast will be taxable) to be contd . 26. Selling of space or time slots for advertisements Taxable Non-taxableSale of space or time for Sale of space for advertisement inadvertisement to be broadcast on print mediaradio or televisionSale of time slot by a broadcasting Sale of space for advertisement

in billorganization boards, public places (including stadia), buildings, conveyances, cell phones, automated teller machines, internet Aerial advertising Presentation made in person

27. Selling of space or time slots for advertisementsAdvertisement" means any form of presentation for promotion of, or bringing awareness about, any event, idea, immovable property, person, service, goods or actionable claim through newspaper, television, radio or any other means but does not include any presentation made in person; Services provided by advertisement agencies relating to preparation / designing etc of advertisements are taxable. Print media includes newspaper and books. 28. Service way of access to a road or a bridge on payment of toll charges Only covers toll charges for access to road and bridge Includes National highways or state highways. Toll on other roads not in negative list Collection charges or service charges paid to any toll collection agency are not covered under negative list Dose not include services used for providing such service 29. Betting, Gambling or LotteryBetting or Gambling means putting on stake something of value, particularly money, with consciousness of risk and hope of gain on the outcome of a game or a contest, whose result may be determined by chance or accident, or on the likelihood of anything occurring or not occurring Betting is a form of wagering contract in which money or moneys worth is made payable by the parties on the result of an uncertain event, usually a game or sport Gambling means playing game of chance for money or risky action undertaken with the hope of success Lottery is a game of chance (e.g. lottery, bingo, lotto etc.) which may include online games to be contd . 30. Betting, Gambling or Lottery Auxiliary services for organizing or promoting betting or gambling events are not covered in negative list State subject covered in list II Actionable claim In Union of India & Others v. Martin Lottery Agencies Ltd (2009) 14 STR 593 (Supreme Court), it was held that service tax can not be levied on sale of lottery ticket In Martin Lottery Agencies Ltd. v. Union of India (2007) 8 STR 561 (Sikkim), it was held that petitioner was not rendering services in relation to promotion of clients goods and service tax liability did not arise 31. Admission to entertainment events and access to amusement facilitiesEntertainment event if it is intended (may notnecessarily provide) to provide any one or more ofthe following to the recipients / viewers / audience recreation pastime fun , or enjoyment to be contd . 32. Admission to entertainment events and access to amusement facilitiesThis could be by way of exhibition of cinematographic film circus concerts sporting events pageants award functions dance performance musical performance theatrical performances drama, ballets or any such event / programme. to be contd . 33. Admission to entertainment events and access to amusement facilitiesAmusement facility" means a facility where fun recreation is provided by means of rides gaming devices bowling alleys in amusement parks amusement arcades water parks theme

parks such other places but does not include a place within such facility where other services are provided to be contd .

34. Admission to entertainment events and access to amusement facilities Amusement means entertainment, diversion, pastime, sport etc. Theatrical performances need not be performed in theatre Standalone amusement ride in a mall fun or recreation by means of ride covered under amusement excluded Membership of club which provides amusement facilities - excluded Event manager for organizing an entertainment event or entertainment is not cover in this category 35. Transmission or distribution of Electricity by an electricity transmission or distribution utility Provided by Electricity Transmission or Distribution utility Covers both Transmission Distribution Installation of gensets or similar equipment by private contractor for distribution - taxable Charges collected by developer or a housing society for distribution of electricity within a residential complex - taxable but excluded if it acts as a licensed authority 36. Specified services relating to education Service by way of - i. Pre-school education and education up to higher secondary school or equivalent ii. Education as a part of a prescribed curriculum for obtaining a qualification recognized by law iii. Education as a part of an approved vocational education course Conduct of degree courses by colleges, universities or institutions which lead to grant of qualifications recognized by law to be contd . 37. Specified services relating to educationApproved vocational education course a course run by an industrial training institute or an industrial training centre affiliated to the National Council for Vocational Training, offering courses in designated trades as notified under the Apprentices Act, 1961 a Modular Employable Skill Course, approved by the National Council of Vocational Training, run by a person registered with the Directorate General of Employment and Training, Ministry of Labour and Employment, Government of India a course run by an institute affiliated to the National Skill Development Corporation set up by the Government of India to be contd . 38. Specified services relating to education Education upto higher secondary school or equivalent are in negative list. Services provided to or by an educational institution for Auxiliary educational services and renting of immovable property exempted under mega notificationNegative list will not include Private tuitions Education as a part of prescribed curriculum for obtaining qualification recognized by law of a foreign county Services provided to educational institutions Placement services to be contd . 39. Specified services relating to educationEducation related services not in negative list but exemptfrom tax under Notification No. 25/2012-ST dated20.06.2012 Transportation of students to / from institutions Provision of mid-day meal in schools Admission related services to educational institutes where education services are exempt. Coaching / training in recreational activities of arts, culture or sports. 40. Services by way of renting of residential dwelling for use as residenceRenting coves all types of arrangements in relation to immovableproperty with or without its transfer of

possession or control andwhether wholly or partly. It would cover / include allowing permitting granting access / entry / occupation use of facility letting leasing licensing, or other similar arrangements (such as right to use, sub-lease, space sharing etc.) to be contd .

41. Services by way of renting of residential dwelling for use as residenceRenting of certain kinds of property already covered inthe negative list renting of vacant land, with or without a structure incidental to its use, relating to agriculture. renting of residential dwelling for use as residence renting out of any property by Reserve Bank of India renting out of any property by a Government or a local authority to non-business entity to be contd . 42. Services by way of renting of residential dwelling for use as residence Residential dwelling not defined but includes residential accommodation does not include hotel, motel, inn, Guest house, camp site, lodge, house boat or other placement temporary stay Residential dwelling used partly as a residence and partly for non residential purposetreated as bundled service Residential unit independent residential unit with specific facilities for living, cooking and sanitation to be contd . 43. Financial ServicesServices by way of (i) extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount; (ii) inter se sale or purchase of foreign currency amongst banks or authorised dealers of foreign exchange or amongst banks and such dealers; to be contd . 44. Financial Services Transactions in money outside the ambit of service Any activity related to a transaction in money by way of its use or conversion by cash or by any other mode, from one form , currency or denomination to another form, currency or denomination would not be treated as a transaction in money if a separate consideration is charged for such an activity Service tax levied on service charges for transactions in money including of charges for making of drafts, letter of credits issuance charges, service charges relating to issuance of CDs/ CPs etc Interest rate swaps and foreign exchange swaps are excluded being securities and hence excluded to be contd . 45. Financial Sector Only interest and discount are in negative list Interest on Money borrowed Debt incurred Deposit Claim / obligation/ similar right Service charge / fee/ commission not covered (e.g. pre payment fee, late fee, cheque bounce charges) interest on credit facility not utilized (commitment charges ) not covered Bill discounting only discount covered to be contd . 46. Financial Services Any charges over and above interest/ discount taxable Purchase/ sale of foreign currency between banks and authorized dealers under negative list Examples of services in negative list- Fixed deposits or saving deposits or any other such deposits in a bank for which return is received by way of interest Providing a loan or over draft facility for in consideration for payment of interest Mortgages or loans with a collateral security to the extent that the consideration for advancing such loans or advances are represented by way of interest Corporate deposits to the extent that the consideration for advancing such loans or advances are represented by way of interest or discount

47. Services relating to transportation of passengersServices by- a stage carriage; railways in a class other than (i) first class; or (ii) an AC coach; ( now exempt under Notification No 43/2012) metro, monorail or tramway; inland waterways; public transport, other than predominantly for tourism purpose, in a vessel, between places located in India; and metered cabs, radio taxis or auto rickshaws. to be contd . 48. Services relating to transportation of passengers Stage Carriage is defined in section 2(40) of Motor Vehicles Act, 1988. It means a motor vehicle constructed or adapted to carry more than six passengers excluding the driver for hire or reward at separate fares paid by or for individual passengers, for the whole journey or for stages of the journey National waterways covered in inland waterways Metered cab - any contract carriage on which an automatic device, of the type and make approved by the State Transport Authority, is fitted which indicates reading of the fare chargeable at any moment and that is charged accordingly under the conditions of its permit issued under the Motor Vehicles Act, 1988 to be contd . 49. Services relating to transportation of passengersCovered under negative list Not Covered under negative listMotor vehicles on hire to state Motor vehicles to state transporttransport undertaking (more taken undertaking12 passengers)Exemption to Transport of No exemption for Tourism,passengers by a contract carriage conducted tours, chartered or hire 50. Service relating to transportation by Goodsservices provided in relation to transportation ofgoods specified in the negative list by road except the services of (i) a goods transportation agency or (ii) a courier agency by aircraft or vessel from a place outside India up to the customs station of clearance in India; or by inland waterways (agents covered) to be contd . 51. Service relating to transportation by Goods Services provided by GTA taxable except under separate exemption available for fruits, vegetables, eggs, milk, food grains or pulses in a goods carriage; goods where gross amount charged on a consignment transported in a single goods carriage does not exceed one thousand five hundred rupees; or goods where gross amount charged for transportation of all such goods for a single consignee in the goods carriage does not exceed rupees seven hundred fifty. Courier services Express cargo service, angadia taxable to be contd . 52. Service relating to transportation by GoodsNature of service relating to Whether covered in thetransportation of Goods negative list entryBy railways NoBy air within the country or NoabroadBy a vessel in the coastal NowatersBy a vessel on a national YeswaterwayServices provided by a GTA No 53. Funeral, Burial, Crematorium or Mortuary Services including Transportation of the deceased Funeral Burial Crematorium Mortuary Transportation of deceased 54. Exemptions under Service Tax General ExemptionsSmall Scale Exemption The threshold exemption limit of Rs. 10 lakh continues to exist and it is over and above the exemptions notified in Notification No. 25/2012-ST dated 20.6.2012. W.e.f. 1.4.2012, aggregate value of Rs. 10 lakh would mean the sum total of value of first consecutive invoices issued during a

financial year, but does not include value charged in invoices towards such services which are exempt from whole of service tax. (Refer Notification No. 33/2012-ST dated 20.6.2012) to be contd.

55. Exemption under Service Tax General Exemptions W.e.f.1.07.2012, Notification No. 6/2005 as amended shall no longer be applicable. There is a change in scope of aggregate value which shall mean as follows and subject to following conditions- total of value of taxable services value shall be as charged in first consecutive invoices issued during financial year value charged in invoices issued for taxable services which are exempt from whole of Service Tax shall be excluded in determining the aggregate value 56. Exemption under Service Tax General ExemptionsExemption for Exporters/SEZ Transportation of export goods by Goods Transport Agency in a goods carriage received by an exporter for transport of goods. (Refer Notification No. 31/2012- ST dated 20.6.2012) Refund of service tax paid on all input taxable services received by an exporter of goods and used for export of goods, subject to certain specified conditions. (Refer Notification No. 39/2012-ST dated 20.6.2012) Taxable services, received by a unit located in a Special Economic Zone or Developer of SEZ for the authorised operations. (Refer Notification No. 40/2012-ST dated 20.6.2012) 57. Exemption under Service Tax General ExemptionsExemption for Exporters/SEZ Rebate of Service Tax paid on taxable services received by exporter of goods and used for export of goods, subject to conditions (Refer Notification No. 41/2012-ST dated 29.6.2012) Exemption to services provided by commission agent located outside India and engaged by Indian exporter for promotion of export goods exported upto Service Tax calculated on 10% of free on board value of export goods (Refer Notification No. 42/2012-ST dated 29.6.2012) 58. Exemption under Service Tax General ExemptionsExemption to Import of Technology Taxable service involving import of technology, from so much of service tax, as is equivalent to the extent of amount of cess payable on the said transfer of technology under the provisions of section 3 of the Research and Development Cess Act, 1986.(Refer Notification No. 14/2012-ST dated 17.3.2012)Exemption for Services to Foreign Diplomatic Mission Taxable services provided for the official use of a foreign diplomatic mission or consular post in India, or for personal use or for the use of the family members of diplomatic agents or career consular officers posted therein. (Refer Notification No. 27/2012-ST dated 20.6.2012) 59. Exemption under Service Tax General ExemptionsExemption to Services by TBI or STEP Taxable services provided by a Technology Business Incubator (TBI) or a Science and Technology Entrepreneurship Park (STEP) recognized by the National Science and Technology Entrepreneurship Development Board (NSTEDB) of the Department of Science and Technology, Government of India. (Refer Notification No. 32/2012-ST dated 20.6.2012)Exemption to Renting of an Immovable Property Taxable service of renting of an immovable property, from so much of the service tax leviable thereon, as is in excess of the service tax calculated on a value which is equivalent to the gross amount charged for renting of such immovable property less taxes on such property, namely property tax levied and collected by local bodies. (Refer Notification No. 29/2012-ST dated 20.6.2012)

60. Exemption under Service Tax General ExemptionsExemption to Railway Services Taxation of services of passenger transportation by railways in first class / AC coach and transportation of goods by railways exempt upto 30 September, 2012 (Refer Notification No. 43/2012-ST dated 2.7.2012) 61. Specific Exempted Services(Vide mega Exemption Notification No. 25/2012-ST dated 20.6.2012) W.e.f. 1.7.2012 Covers 39 specific exemptions Negative List services not taxable at all ; can be amended only by parliament Exempted services taxable but exempt under notification; can be modified by notification. 62. Services Provided to the United Nations or a Specified International OrganizationServices Provided to the United Nations or a SpecifiedInternational Organization Service provided to all international organization are not exempt but service to only specified international organizations of united Nations (privileges and immunities Act, 1947) are exempt Service provided for official use of foreign diplomatic mission/ counselor post and personal use are exempt vide N. No. 27/2012-ST dated 20.6.2012 63. Health Care ServicesHealth care services by a clinical establishment, an authorisedmedical practitioner or para-medicsWhat is health care Health care services means any service by way of diagnosis or treatment or care For illness, injury, deformity, abnormality or pregnancy in any organization system of medicine and includes services by way of supply of meals for the patient or transportation of the patient to and from a clinical establishment Does not include hair transplant or cosmetic or plastic surgery, except when undertaken to restore or to reconstruct anatomy or functions of body affected due to congenital defects, developmental abnormalities, injury or trauma. 64. Health Care Services Allhealth care services shall not be exempt but only recognized systems of medicine are covered under exemption. Recognized systems of medicine include Allopathy Yoga Naturopathy Ayurveda Homeopathy Siddha Unani Any other system of medicine that may be recognized by Central Government. 65. Health Care ServicesAuthorised medical practitioner means any medical practitioner registered with any of the Councils of the recognised system of medicine includes medical professional having the requisite qualification to practice in any recognised system of medicine as per any law for the time being in force. medical practitioner is a physician or surgeon 66. Health care Services by a Clinical Establishment or Authorized Medical Practitioner or Para medicsClinical establishment means a hospital nursing home clinic, sanatorium or an institution by, whatever name called, that offers services, or facilities requiring diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy, in any recognised system of medicine, established and administered or maintained by any person or a place established as an independent entity or a part of an establishment to carry out diagnostic or investigative services of diseases. 67. Health Care Services Paramedics are trained health care professionals, e.g. nursing staff, physiotherapists, technicians, lab assistants etc. The services to be exempt must be

health care services be provided by - (i) a clinical establishment, or (ii) an authorised medical practitioner, or (iii) para-medics Exempted under Notification No. 30/2011-ST dated 25.4.2011 w.e.f. 1.5.2011.

68. Health Care of Animals or BirdsServices by a veterinary clinic in relation to health care ofanimals or birds Health care services for animals and birds - Exempted Such services are generally provided by a veterinary clinic Veterinary implies relating to the diseases, injuries and treatment of farm and domestic animals 69. Services by way of Charitable ActivitiesServices by an entity registered under section 12AA of the Income taxAct, 1961 by way of charitable activitiesCharitable activitiesClause (k) means activities relating to (a) public health by way of care or counselling of (i) terminally ill persons or persons with severe physical or mental disability (ii) persons afflicted with HIV or AIDS, or (iii) persons addicted to a dependence-forming substance such as narcotics drugs or alcohol or public awareness of preventive health, family planning or prevention of HIV infection (b) advancement of religion or spirituality 70. Services by way of Charitable Activities(c) advancement of educational programmes or skill development relating to,- (I) abandoned, orphaned or homeless children (II) physically or mentally abused and traumatized persons (III) Prisoners or (IV) persons over the age of 65 years residing in a rural area(d) preservation of environment including watershed, forests and wildlife or(e) advancement of any other object of general public utility up to a value of twenty five lakhs rupees in any FY provided that total value of such activities had not exceeded twenty five lakhs rupees during the preceding FY 71. Services by way of Charitable ActivitiesConditions for this exemption - services should be provided by an entity registered u/s 12AA of Income Tax Act, 1961, and services should be charitable activities (as above) 72. Services relating to Religious Place and Religious CeremonyServices by a person by way of- renting of precincts of a religious place meant for general public or conduct of any religious ceremony Renting of precinct of a religious place as well as conduct of any religious ceremony, both shall be exempt Religious place is a place which is primarily meant for conduct of prayers or worship pertaining to a religion Precincts means an area within the walls or perceived boundaries of a particular building or place; an enclosed or clearly defined area of ground around a cathedral, church, temple, college etc. 73. Services relating to Religious Place and Religious Ceremony Exemption is available only if the place is meant for general public General public means the body of people at large sufficiently defined by some common quality of public or impersonal nature E.g.- if a marriage is performed in precincts of a church by renting of that place, it would be exempt 74. Services provided by arbitral tribunalServices provided by- (a) an arbitral tribunal to - (i) any person other than a business entity; or (ii) a business entity with a turnover up to rupees ten lakh in the preceding financial year; (b) an individual as an advocate or a partnership firm of advocates by way of legal services to,- (i) an advocate or partnership firm of advocates providing legal services ; (ii) any person other than a business entity; or (iii) a business entity

with a turnover up to rupees ten lakh in the preceding financial year; or (c) a person represented on an arbitral tribunal to an arbitral tribunal

75. Services provided by arbitral tribunalTaxability for Arbitral TribunalSole / Panel to Arbitral Tribunal exempt to any person (non business entity) exempt to business entity (turnover upto 10 lakh) exempt to business entity (turnover > 10 lakh) taxed under reverse chargeTaxability for advocates Individual / firm to Individual / firm exempt to business entity (turnover upto 10 lakh) exempt to business entity (turnover > 10 lakh) taxed under reverse charge Firm includes LLP Effectively, no tax to be paid by advocates / arbitral tribunal Legal services advice, consultancy or assistance in any branch of law in any manner, includes representational services (N. No. 25/2012-ST dated 20.6.2012) 76. Services by way of technical testing or analysis of newly developed drugsServices by way of technical testing or analysis of newly developed drugs,including vaccines and herbal remedies, on human participants by aclinical research organisation approved to conduct clinical trials by theDrug Controller General of IndiaConditions to be satisfied (a) service of conduct of technical testing and analysis(b) service in relation to newly developed drugs/vaccines/herbal remedies(c) service on human participants(d) service by clinical research organization approved by Drug Controller General of India. 77. Services of training or coaching in recreational activitiesServices by way of training or coaching in recreational activities relating toarts, culture or sports Exemption is to training or coaching Such coaching or training must relate to any one or more of arts, culture, sports Activities by performing artists in folk or classical art forms of music, dance or theatre are not liable to service tax 78. Services provided to / by educational institutionServices provided to or by an educational institution in respect ofeducation exempted from service tax, by way of - auxiliary educational services or renting of immovable property Auxiliary education services shall cover the services in relation to educational activities only and include i. any service relating to imparting any skill knowledge education development of course conduct other knowledge enhancement activity ii. whether for students or faculty iii. out sourced activities ordinarily carried out by educational institutions 79. Services provided to / by educational institutioniii. services in relation to admission conduct of examination catering of students under any mid day meal scheme sponsored by Government Transportation of students or facultyiv. Services in relation to catering under mid day scheme and transportation were hitherto exempt under different notifications under outdoor catering services and tour operators services 80. Services provided to a recognised sports bodyServices provided to a recognized sports body by-a) an individual as a player, referee, umpire, coach or team manager for participation in a sporting event organized by a recognized sports body;b) another recognised sports body; Recognized sports body include IOA, SAI, Intl0A, etc Services by individual player, referee etc to sports body are exempt for participation in event Services by one recognized sport body to other is exempt Services by individuals such as selectors,

commentators, curators, technical experts is not exempt Services provided to unrecognized franchisee of sport event taxable (eg: IPL)

81. Services by way of sponsorship of sporting eventsServices by way of sponsorship of sporting events organised- a) by a national sports federation, or its affiliated federations, where the participating teams or individuals represent any district, state or zone; b) by Association of Indian Universities, Inter-University Sports Board, School Games Federation of India, All India Sports Council for the Deaf, Paralympic Committee of India or Special Olympics Bharat; c) by Central Civil Services Cultural and Sports Board; d) as part of national games, by Indian Olympic Association; or e) under Panchayat Yuva Kreeda Aur Khel Abhiyaan (PYKKA) Scheme 82. Services by way of sponsorship of sporting events Events, i.e., tournaments or championships organized only by specified bodies in relation to games, sport, cultural events etc Exempted Any sponsorship of event organized by any other body like BCCI arranging IPL cricket tournament Not Exempted Vide N. No. 30/2012-ST dated 20.6.2012, entire service tax is payable by the body corporate or partnership firm receiving the service in India under reverse charge method 83. Services provided to the Government, a local authority or a governmental authorityServices provided to the Government, a local authority or a governmentalauthority by way of construction, erection, commissioning, installation,completion, fitting out, repair, maintenance, renovation, or alteration of -a) a civil structure or any other original works meant predominantly for use other than for commerce, industry, or any other business or profession;b) a historical monument, archaeological site or remains of national importance, archaeological excavation, or antiquity specified under the Ancient Monuments and Archaeological Sites and Remains Act, 1958 (24 of 1958);c) a structure meant predominantly for use as (i) an educational, (ii) a clinical, or (iii) an art or cultural establishment;d) canal, dam or other irrigation works;e) pipeline, conduit or plant for (i) water supply (ii) water treatment, or (iii) sewerage treatment or disposal; orf) a residential complex predominantly meant for self-use or the use of their employees or other persons specified in the Explanation 1 to clause 44 of section 65 B of the said Act; 84. Services provided to the Government, a local authority or a governmental authority Government (States or Central) or any local authority (such as municipal corporation, development authority etc) or governmental authority (such as Revenue Board, Water Board etc) shall be exempt from levy of service tax on construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration, in relation to specified structure, buildings or complex. 85. Services provided to the Government, a local authority or a governmental authority Construction of buildings or structures such as hospitals or educational institutes for the government or local authority or governmental authority Exempt if such construction is for others Taxable A civil structure or any other original works meant predominantly for use other than for commerce, industry, or any other business or profession Exempt If client is other than the Government, a local authority or a governmental authority, service

tax is required to paid Service tax is payable on construction of a residential complex having more than one single residential unit

86. Services provided by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alterationServices provided by way of construction, erection, commissioning,installation, completion, fitting out, repair, maintenance, renovation, oralteration of,- a) a road, bridge, tunnel, or terminal for road transportation for use by general public; b) a civil structure or any other original works pertaining to a scheme under Jawaharlal Nehru National Urban Renewal Mission or Rajiv Awaas Yojana; c) a building owned by an entity registered under section 12 AA of the Income tax Act, 1961(43 of 1961) and meant predominantly for religious use by general public; d) a pollution control or effluent treatment plant, except located as a part of a factory; or e) a structure meant for funeral, burial or cremation of deceased 87. Services provided by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration Construction of roads for use by general public - Exempt Construction of roads which are not for general public use e.g. construction of roads in a factory, residential complex etc Taxable If assessee is constructing such structures for the government, a local authority or a governmental authority Exempt If assessee is constructing for others Taxable construction of a building owned by an entity registered under section 12 AA of the Income tax Act, 1961 and meant predominantly for religious use by general public Exempt Repair, maintenance of airports, ports and railways -Taxable 88. Services by way of construction, erection, commissioning, or installation of original worksServices by way of construction, erection, commissioning, or installationof original works pertaining to,-a) an airport, port or railways, including monorail or metro;b) a single residential unit otherwise than as a part of a residential complex;c) low- cost houses up to a carpet area of 60 square metres per house in a housing project approved by competent authority empowered under the Scheme of Affordable Housing in Partnership framed by the Ministry of Housing and Urban Poverty Alleviation, Government of India;d) post- harvest storage infrastructure for agricultural produce including a cold storages for such purposes; ore) mechanised food grain handling system, machinery or equipment for units processing agricultural produce as food stuff excluding alcoholic beverages; 89. Services by way of construction, erection, commissioning, or installation of original works Original works as defined in Valuation Rules means (a) all new constructions; or (b) all types of additions and alterations to abandoned or damaged structures on land that are required to make them workable, (c) erection, commission or installation of plant, machinery or equipment or structures, whether prefabricated or otherwise No service tax liability on erection or installation of machineries or equipments for units processing agricultural produce Erection or installation of machineries or equipments for dal mills, rice mills, milk dairies or cotton ginning mills -Exempt Only erection and construction of original works is covered Exemption will cover low cost houses under the scheme of affordable housing in partnership

90. Temporary transfer or permitting the use or enjoyment of a copyrightTemporary transfer or permitting the use or enjoyment of a copyrightcovered under clauses (a) or (b) of subsection (1) of section 13 of theIndian Copyright Act, 1957 relating to original literary, dramatic, musical,artistic works or cinematograph films; A music company would be required to pay service tax Service Tax is not payable on the royalty amount so received from the music company by composer an author having copyright of a book written by him Exempt copyright of a cinematographic film -Exempt 91. Services by a performing artist in folk or classical art formsServices by a performing artist in folk or classical art forms of (i) music, or(ii) dance, or (iii) theatre, excluding services provided by such artist as abrand ambassador; The service provided by any person being a performing artist in the form of - folk, or classical in relation to - music, dance, or theatre are exempt if such an artist provides services as a brand ambassador for any product, service, event or company etc for a consideration - Taxable 92. Services by way of collecting or providing newsServices by way of collecting or providing news by an independentjournalist, Press Trust of India or United News of India; The exemption will be available to following persons or service providers (a) independent journalists (individuals, reporters, correspondents etc but not editors of newspapers or electronic media) (b) Press Trust of India (PTI) (c) United News of India (UNI) PTI and UNI are government sponsored news agencies Non Taxable News syndication by private news agencies for a consideration - Taxable 93. Services by way of renting of a hotel, inn, guest house, club, campsite or other commercial placesServices by way of renting of a hotel, inn, guest house, club, campsite orother commercial places meant for residential or lodging purposes, havingdeclared tariff of a unit of accommodation below rupees one thousand perday or equivalent Declared tariff includes charges for all amenities provided in the unit of accommodation (given on rent for stay) like furniture, air- conditioner, refrigerators or any other amenities, but does not include any discount offered on the published charges for such unit Abatement under Notification No. 26/2012-ST is also available to such services where declared tariff is Rs. 1000 or more and Service Tax is payable only on 60 per cent of the gross value of taxable service 94. Serving of food or beverages by a restaurant / eating jointsServices provided in relation to serving of food or beverages by arestaurant, eating joint or a mess, other than those having (i) the facilityof air-conditioning or central air-heating in any part of the establishment,at any time during the year, and (ii) a licence to serve alcoholicBeverages It is not necessary that the facility of air-conditioning is available round the year Serving of food or beverages in a centrally air-conditioned premise will be taxed if its restaurant has a license to serve alcoholic beverages those restaurants which do not have license to serve alcoholic beverages - Exempt Under N. No. 26/2012-ST dated 20.6.2012, abatement @ 30 per cent is allowed w.e.f. 1.7.2012 to bundled services by way of supply of food or any other article of human consumption or any drink in a premises, including a hotel, convention centre, club etc. subject to condition of non availment of Cenvat Credit on inputs.

95. Services by way of transportation by rail or a vessel from one place in India to anotherServices by way of transportation by rail or a vessel from one place inIndia to another of the following goods -a. petroleum and petroleum products falling under Chapter heading 2710 and 2711 of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986);b. relief materials meant for victims of natural or man-made disasters, calamities, accidents or mishap;c. defence or military equipments;d. postal mail or mail bags;e. household effects;f. newspaper or magazines registered with the Registrar of Newspapers;g. railway equipments or materials;h. agricultural produce;i. foodstuff including flours, tea, coffee, jaggery, sugar, milk products, salt and edible oil, excluding alcoholic beverages; orj. chemical fertilizer and oilcakes; 96. Services by way of transportation by rail or a vessel from one place in India to another The exemption is in relation to (a) transportation of specified goods only (b) in a rail or a vessel. (c) from one place to other by rail or vessel Goods specified are of general nature, transportation of which is in national and public interest 97. Services provided by a goods transport agency for transportation of goodsServices provided by a goods transport agency by way oftransportation of -a) fruits, vegetables, eggs, milk, food grains or pulses in a goods carriage;b) goods where gross amount charged for the transportation of goods on a consignment transported in a single goods carriage does not exceed one thousand five hundred rupees; orc) goods, where gross amount charged for transportation of all such goods for a single consignee in the goods carriage does not exceed rupees seven hundred fifty; 98. Services by way of giving on hireServices by way of giving on hire - a) to a state transport undertaking, a motor vehicle meant to carry more than twelve passengers; or b) to a goods transport agency, a means of transportation of goodsExemption shall be available subject to following conditions hiring to a State transport undertaking or to a goods transport agency hiring of motor vehicle to carry more than 12 passengers or in case of GTA, for transportation of goods In both the cases, vehicle should be given on hire 99. Transport of passengers with or without accompanied belongingsTransport of passengers, with or without accompanied belongings, by - a) air, embarking from or terminating in an airport located in the state of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, or Tripura or at Bagdogra located in West Bengal; b) a contract carriage for the transportation of passengers, excluding tourism, conducted tour, charter or hire; or c) ropeway, cable car or aerial tramway;The ingredients of a contract carriage are - It carries passengers for hire or reward It is engaged in contract whether expressed or implied for use of such vehicle as a whole; The contract must be entered into by the person with the holder of permit in relation to such vehicle or with any person authorized by him 100. Transport of passengers with or without accompanied belongings The agreed consideration can either by on time basis or one point to another; The vehicle should not stop to pick up or set down passengers not included in the contract anywhere during the journey; It includes maxi-cab or motor-cab. In cases where a bus operates on a route

under a contract carriage and passengers embark or disembark from the bus at any place falling on the route and pay separate fares for the whole or for stages of journey, no Service Tax would be payable. transport of passenger in a contract carriage for the transportation of passengers for tourism, conducted tour, charter or hire is taxable

101. Services by way of vehicle parking to general publicServices by way of vehicle parking to general public excluding leasing ofspace to an entity for providing such parking facility Rent of vacant land used for parking is liable to Service Tax No Service Tax is payable on providing the facility of motor vehicle parking to general public Parking facility provided to any one which is not a general public, say a bank or hotel or car dealer etc Taxable General public defined to mean the body of people at large sufficiently defined by some common quality of pubic or impersonal nature 102. Services provided to Government, a local authority or a governmental authorityServices provided to Government, a local authority or a governmentalauthority by way of -a) carrying out any activity in relation to any function ordinarily entrusted to a municipality in relation to water supply, public health, sanitation conservancy, solid waste management or slum improvement and upgradation; orb) repair or maintenance of a vessel or an aircraftServices provided to the Government or a local authority or GovernmentalAuthority may cover services by way of (a) repair of a ship, boat or vessel or aircraft (b) effluents and sewerage treatment; (c) waste collection or disposal; (d) storage, treatment or testing of water for drinking purposes; or (e) transport of water by pipeline or conduit for drinking purposes; 103. Services provided to Government, a local authority or a governmental authorityActivities carried out in relation to functions ordinarilyentrusted to municipality in relation to water supply public health sanction conservation solid waste management slum improvement / upgradation 104. Services of general insurance businessServices of general insurance business provided underfollowing schemesa. Hut Insurance Scheme;b. Cattle Insurance under Swarnajaynti Gram Swarozgar Yojna (earlier known as Integrated Rural Development Programme);c. Scheme for Insurance of Tribals;d. Janata Personal Accident Policy and Gramin Accident Policy;e. Group Personal Accident Policy for Self-Employed Women;f. Agricultural Pumpset and Failed Well Insurance;g. premia collected on export credit insurance; 105. Services of general insurance businessh. Weather Based Crop Insurance Scheme or the Modified National Agricultural Insurance Scheme, approved by the Government of India and implemented by the Ministry of Agriculture;i. Jan Arogya Bima Policy;j. National Agricultural Insurance Scheme (Rashtriya Krishi Bima Yojana);k. Pilot Scheme on Seed Crop Insurance;l. Central Sector Scheme on Cattle Insurance;m. Universal Health Insurance Scheme;n. Rashtriya Swasthya Bima Yojana; oro. Coconut Palm Insurance Scheme; 106. Services provided by an incubateeServices provided by an incubatee up to a total turnover of fifty lakhrupees in a financial year subject to the following conditions, namely:-a) the total turnover had not exceeded fifty lakh rupees during the preceding financial year; andb) a period of three years has not been elapsed from the date of entering into an agreement as an incubateeServices provided by an incubatee up to a total businessturnover

of fifty lakh rupees in a financial year subject toconditions the total business turnover had not exceeded fifty lakh rupees during the preceding financial year; and a period of three years has not lapsed from the date of entering into an agreement as an incubatee

107. Service by an unincorporated body or a non- profit entityService by an unincorporated body or a non- profit entity registered underany law for the time being in force, to its own members by way ofreimbursement of charges or share of contribution - a) as a trade union; b) for the provision of carrying out any activity which is exempt from the levy of service tax; or c) up to an amount of five thousand rupees per month per member for sourcing of goods or services from a third person for the common use of its members in a housing society or a residential complex Services should be provided to own members and not to nonmembers. Service of an unincorporated body or a non- profit entity registered under any law for the time being in force to its own members up to an amount of Rs 5,000 per member per month by way of reimbursement of charges or share of contribution is exempt from service tax 108. Services provided by IntermediariesServices by the following persons in respective capacities -a) sub-broker or an authorised person to a stock broker;b) authorised person to a member of a commodity exchange;c) mutual fund agent to a mutual fund or asset management company;d) distributor to a mutual fund or asset management company;e) selling or marketing agent of lottery tickets to a distributer or a selling agent;f) selling agent or a distributer of SIM cards or recharge coupon vouchers;g) business facilitator or a business correspondent to a banking company or an insurance company, in a rural area; orh) sub-contractor providing services by way of works contract to another contractor providing works contract services which are exempt; 109. Services by an organizer to any person in respect of a business exhibition held outside IndiaServices by an organizer to any person in respect of a business exhibitionheld outside India Organizer should be in India Exhibition should be held outside India It should be in relation to business 110. Services by way of making telephone callsServices by way of making telephone calls from -a) departmentally run public telephone;b) guaranteed public telephone operating only for local calls; orc) free telephone at airport and hospital where no bills are being issued 111. Services by way of slaughtering of bovine animalsServices by way of slaughtering of bovine animals 112. Services received from a provider of service located in a non- taxable territoryServices received from a provider of service located in a non- taxableterritory by -a) Government, a local authority, a governmental authority or an individual in relation to any purpose other than commerce, industry or any other business or profession;b) an entity registered under section 12AA of the Income tax Act, 1961 (43 of 1961) for the purposes of providing charitable activities; orc) a person located in a non-taxable territory If services are used for industry, business or commercial purpose, service tax is payable under reverse charge basis Other purposes, it will be exempt from service tax

113. Services of Public LibrariesServices of public libraries by way of lending of books, publications or anyother knowledge- enhancing content or materialFollowing services of public libraries shall be exempt lending of books lending of publications lending of other knowledge enhancing content or material, (i.e. in soft or hard version, digital content, web content etc) Public library has not been defined 114. Services by Employees State Insurance Corporation to persons governed under the Employees Insurance Act, 1948Services by Employees State Insurance Corporation to persons governedunder the Employees Insurance Act, 1948 (34 of 1948) Covers the services provided by the Employees State Insurance Corporation (ESIC) constituted under the Employees State Insurance Act, 1948 in relation to employees sickness, maternity and employment injury and promotion of measures for health etc of insured persons 115. Services by way of transfer of a going concernServices by way of transfer of a going concern, as a whole or anindependent part thereof Going Concern as per AS-1 Sale of business as a whole Related services are taxable 116. Services by a governmental authority by way of any activity in relation to any function entrusted to a municipalityServices by a governmental authority by way of any activity in relation toany function entrusted to a municipality under article 243 W of theConstitution All services are not exempt Services by a governmental authority by way of any activity in relation to any function entrusted to a municipality under article 243W of the Constitution are exempt

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