Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: list of goods taxed at 4% :: ACCOUNTING STANDARDS :: ACCOUNTING STANDARD :: empanelment :: VAT Audit :: VAT RATES :: due date for vat payment :: TDS :: TAX RATES - GOODS TAXABLE @ 4% :: Central Excise rule to resale the machines to a new company :: form 3cd :: ARTICLES ON INPUT TAX CREDIT IN VAT :: cpt :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: articles on VAT and GST in India
 
 
Transfer Pricing »
 The transfer pricing conflict is about profit shifting
 Transfer Pricing Compensating Adjustments: Another IRS Loss
 HMRC steps up inquiries into cross-border deals by big business
 An Overview of Transfer Pricing in China
 South Africa: transfer pricing record-keeping rules finalized
 India among the top three nations where transfer pricing policies faced official examination: EY Survey
 Vietnam publishes draft transfer pricing law to combat tax avoidance
 New transfer pricing documentation rules and fiscal assessment procedure in Finland
 India, US resolve tax disputes worth Rs 5,000 crore via APA
 India, UK sign three Advance Pricing Agreements
  Foreign Exchange Management (Insurance) Regulations, 2015

Money transfer from abroad in service tax net
October, 16th 2014

The Centre on Tuesday decided to garner revenue by indirectly levying service tax on NRI remittances, a move that will eat into the earnings of lakhs of NRIs who regularly send money back home.

In a circular issued by the Central Board of Excise and Customs (CBEC), the government said banks and financial institutions which levy a fee or commission for facilitating the transfer of money from abroad will have to pay service tax.

The circular effectively revises the government decision of 2012 to not levy service tax on NRI remittances.

The circular issued late on Tuesday night by Dr Abhishek Chandra Gupta, technical officer of CBEC, said that banks and financial institutions fall under the
category of intermediary as defined in rule 2 (F) of the Place of Provision of Service Rules 2012.

Sachin Menon, chief operating officer, tax and regulatory services, KPMG, said the circular was "completely unfair" to NRIs who send remittances to the country.

"No service provider pays service tax from his pocket," Menon said.

Menon said the move was akin to "picking the pockets of labourers and maidservants" who work abroad.

"Assuming that Rs10 is the additional cost [transaction fee charged by money transfer agent] of every Rs 100 that an NRI sends, now only Rs 98.76 will be received for every Rs100 sent [after reducing 12.36% service tax on Rs10]," Menon said.

Critics also said the move might result in a rise in anti-national activities, with money remitted through hawala as an alternative.

Emerging as the top recipient of money from abroad among developing nations, the country received remittances of $64 billion in 2011, according to World Bank data.

Chief ministers of Punjab and Kerala, states that get the largest remittances, had taken up the matter with prime minister Manmohan Singh when the tax was previously mooted, and the circular was withdrawn in 2012.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Software Work Flow Workflow Software Software Automation Workflow automation Software Design Workflow Design Business Work Flow Workflow automation tools

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions