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: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: form 3cd :: TAX RATES - GOODS TAXABLE @ 4% :: ACCOUNTING STANDARDS :: ACCOUNTING STANDARD :: TDS :: VAT RATES :: Central Excise rule to resale the machines to a new company :: VAT Audit :: due date for vat payment :: articles on VAT and GST in India :: empanelment :: ARTICLES ON INPUT TAX CREDIT IN VAT :: cpt :: list of goods taxed at 4%
 
 
News Headlines »
 How to link your Aadhaar and PAN details to file income-tax returns
 How to calculate capital gains tax on property sold at less than stamp value?
 Return Filing - Under GST, this is how you will file tax returns from July 1
 Income tax filing FAQs part 1
 Filing Income Tax Returns? Things To Keep In Mind As Deadline Approaches
 Filing of online return for 4th quarter of 2016-17- extension of period thereof.
 New tax accounting standards may reduce leeway for infrastructure companies
 GST – CONCEPT & STATUS – As on 01st May, 2017
 Govt extends VAT deadline, relief for developers
 Income Tax Appellate Tribunal Rules, 2017
 Got your Form 16? You should file income tax returns early to enjoy benefits

Govt likely to scrap 12% service tax on exporters
January, 22nd 2007

Budget 2007-08 is likely to bring some good news for exporters. For, the government is planning to scrap the 12.24% service tax imposed on them.

The tax was introduced to include exporters, availing services of foreign-based commission agents to win export orders, warehousing facilities abroad and haulage charges incurred overseas. With exports $125 billion and since the minimum commission charged by overseas agents is 1%, the taxable amount for this service tax is estimated at $1.2 billion.

With a 12% service tax on them, exporters cough up $144 million. Exporters find it diffucult to pay such a huge amount, as they need agents, without whom it will be tough for them to locate good buyers.

While exporters in most of the sectors pay a commission of 1%-5% of the freight-on-board value of exports, the pharmaceutical sector pays 15-20% of the FOB value. Exporters had met both commerce minister Kamal Nath and finance minister P Chidambaram on January 8 and were assured that the tax would be scrapped, an official told FE. Admitting one such petition filed by the Indian Exporters Grievances Forum (IEGF), the Delhi High Court had issued notice to the finance ministry in May 2006.

However, the matter was adjourned several times and the ministry did not file their reply even on Friday. The ministry instead sought time. The court then said as the last opportunity, the finance ministry would have to file its reply by April 23, the next date of hearing.

THE RELIEF
SERVICE TAX was introduced to include exporters, availing services of foreign-based commission agents
THE TAXABLE amount for this service tax is estimated at $1.2 billion
WITH A 12% service tax on them, exporters cough up
$144 million
 
Meanwhile, Tamil Nadu Spinning Mills Association has won a stay order against the government from the Madras High Court in a case.

Exporters said such a service tax, that too with retrospective effect, would make them suffer, as there is no mechanism to refund it adding that such a tax is "illegal and unconstitutional". It is against the government policy that exports must be tax-free.

IEGF alleged that the government had extended the territorial jurisdiction of the Finance Act beyond the territory of India without having any substantive provisions under the Act. But the finance ministry had said these instances of service tax falls under the "business auxiliary service" category, where by from September 2004, the government can levy charges from the exporter for the services taken from agents with offices outside India.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Custom Software Development Outsourcing Custom Software Development Offshore Cus

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