KPMG booked for allegedly evading Service Tax of Crores
December, 19th 2007
Top Tax Advisory Firm KPMG has been booked by the Service Tax Department for allegedly evading service tax of several Crores on services received by KPMG from abroad as well as services rendered within India.
Service Tax Department has initiated investigations against KPMG, one of the world's leading Tax Consultants, regarding non payment of Service Tax.
KPMG has already deposited an amount of Rs 3.5 Crores approximately, towards service tax not paid including education cess and interest at the rate of 13 percent per annum.
Further investigation into non-payment of Service Tax on services received from abroad as well as services rendered within India, is under progress.
KPMG is advising over 200 MNCs in India on service tax issues. MNCs sign a global contract with one of the Big 4 Consulting Companies (Ernst & Young, Price Waterhouse Coopers, KPMG & Deloitte) for Tax Advisory services for which MNCs are charged at hourly rates quoted by the Companies. The rates range from Rs 5000/- Per Hour to Rs 20000/- Per Hour spent by the Consultants hired by the Companies on the assignments given by the clients. Opinion charges range upto Rs 2 Lakh per Opinion.
Earlier Ernst & Young was also booked by the Service Tax Department but it has already challenged the Show Cause Notice issued by the service tax deparment in Delhi High Court.