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: TAX RATES - GOODS TAXABLE @ 4% :: VAT Audit :: form 3cd :: VAT RATES :: ARTICLES ON INPUT TAX CREDIT IN VAT :: ACCOUNTING STANDARDS :: due date for vat payment :: empanelment :: ACCOUNTING STANDARD :: TDS :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: articles on VAT and GST in India :: list of goods taxed at 4% :: cpt :: Central Excise rule to resale the machines to a new company
 
 
« General »
 Retailers need to file single GST return every month
 Aadhaar is must for income tax returns if you have one; Here's how you can file it online
 Will it be a tax haven above the law?
 Your mutual fund investment tax efficient? Here are 3 steps to ensure utmost efficiency for your portfolio
 Finally a goods and services tax. But what lies ahead?
 Tax May Rise On Outbound M&As, Indian Mncs’ Investments
 Filing income tax return? Do remember to claim benefits on your reimbursements
 Banks will have a hard slog ahead to get GST-ready
 Clarification regarding applicability of Section 16 (1)(a) of the Companies Act. 2013 with reference to cases under corresponding provisions of Companies Act. 1956
 Introduce indemnity clauses with suppliers on tax compliance: Expert
 While filing tax in India, NRIs do not have to report overseas assets

Advisory services may come under tax ambit
January, 21st 2011

Some advisory services are on a list of up to 12 services that may be brought into the tax net in Budget 2011-12. Their possible inclusion is part of the finance ministrys attempt to boost service tax collections without tinkering too much with tax rates. Service tax is currently levied on scientific, technical and legal consultancy services.

Advisory services are provided in a whole range of areas such as corporate finance, accounting, auditing, taxation, management and technology. At present, the government levies a tax on 117 services. Only three services were taxed when the levy was introduced in 1994-95.

Some 10-12 services could be brought under the tax ambit in this Budget. We are seeing it as a transition towards the goods & services tax. The only way to bring down rates under GST is to include more services, a finance ministry official, who did not wish to be named, told Business Standard.

Another official said the number of new services to be taxed could well be more than 12. He said the effort would be to gradually include all items listed in the United Nations Central Product Classification for goods and services. The CPC is intended as an international standard to organise and analyse data on industrial production, national accounts, trade and other aspects.

The CPC includes services in sectors like trading, hospitality, transport, communications, business, agriculture, mining & manufacturing, community and social. India does not use the classification, but it does levy tax on 60-70 per cent of these services.

We look at international practices when levying tax on new goods and services. Still, there are many services in the CPC that are not yet taxed in India. All those will be gradually taxed. To begin with, advisory services can be included in the service tax, said an official.

Official sources said services in electricity transmission, education and health were some big-ticket areas, but the finance ministry was in two minds about including them in the tax net.

Services contribute around 60 per cent to GDP, but they generate only 10 per cent to tax collections. The governments service tax receipts grew 19 per cent to Rs 44,081 crore in April-December this fiscal. The growth was meagre, compared with the 68.1 per cent and 33.7 per cent recorded by Customs and excise collections, respectively, in the same period.

The finance ministry added eight more services in the tax net in the last Budget, while amendments were made with regard to some existing services. The proposal to levy a tax on some services was challenged in various courts and could result in some loss to the exchequer.

The government needs to raise additional resources to bring down the fiscal deficit from a projected 5.5 per cent of GDP this fiscal to 4.8 per cent in 2011-12. While it may not be in a position to raise tax rates because of high inflation, broadening the tax net and greater compliance may help it meet its fiscal consolidation targets.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Our Team

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