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: ACCOUNTING STANDARDS :: articles on VAT and GST in India :: ARTICLES ON INPUT TAX CREDIT IN VAT :: VAT Audit :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: VAT RATES :: Central Excise rule to resale the machines to a new company :: ACCOUNTING STANDARD :: cpt :: empanelment :: form 3cd :: due date for vat payment :: TAX RATES - GOODS TAXABLE @ 4% :: TDS :: list of goods taxed at 4%
 
 
« Service Tax »
 India’s E-Service Tax Will Add To Foreign Content Providers’ Woes
 GST Council to discuss model laws, tax jurisdiction today
 Tax Invoice Under GST
 Insurance may fall under 12% tax slab in GST, from 14% service tax currently
 GST draft makes it must for companies to pass tax benefit to consumers
 To speed passage, Government plans GST Bills as money Bills
 No service tax on train tickets booked through IRCTC till December 31
 GST Council meet postponed to December
 Banks integrating systems with RBI, GST Network to collect tax: Arun Jaitleya
 Service tax waived for online train ticket booking till Dec 31
 Key challenges in implementation of Goods and Services Tax

SEZ units get service tax relief
March, 07th 2009

Service tax refund for services availed outside the zones.

Meeting a long-pending demand, the government has allowed companies located in Special Economic Zones (SEZs) to claim service tax refund for services availed outside the tax-free export zones. SEZ developers are also permitted to do the same.

For example, under the earlier norms, if a unit was transporting raw material from a port located outside the SEZ, service tax would have to be paid. Now the unit will be able to apply for refund.

The refund will be allowed only for services that are related to authorised operations (permitted activities within SEZs).

Another change pertains to services provided between units located within an SEZ. Earlier, this was exempted but now firms have to claim refund instead of a blanket exemption.

The commerce ministry had been maintaining that the zones were exempt form all indirect taxes related to authorised operations, whether they were subscribed inside or outside the zone.

The issue had come up for discussion in an Empowered Group of Ministers meeting in August 2008 chaired by External Affairs Minister and Finance Minister Pranab Mukherjee. The panel of ministers had agreed to the commerce ministry viewpoint.

The latest move will benefit service providers more than the SEZs. Developers and units will have to pay service tax before claiming refund. Moreover, some services subscribed may not be in relation to the authorised operations, so the refund granted could be lesser than the amount applied for.

But service providers can now charge service tax for the services subscribed by SEZs, said Rajeev Dimri, Leader, Indirect Tax Practice, BMR Advisors.

Welcoming the decision, L B Singhal, director general of Export Promotion Council for Export Oriented Units (EoUs) and SEZs, pointed out towards certain operational issues. Service tax has to be paid first and then refund has to be claimed. It would result in unnecessary blockage of funds, paper work and transaction costs. Hence it would be appropriate if exemption could be provided, he said.

Singhal also said that the new notification mandates that the refund has to be collected from the respective assistant commissioner or deputy commissioner of the central excise department. The SEZ Act intends to provide a single-window mechanism. Hence, refund should be provided either from the office of the development commissioner or Customs officer posted in the zone. SEZ units or developers must not be asked to go outside the SEZ for taking this refund, he added.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Our Mission

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