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: Central Excise rule to resale the machines to a new company :: TAX RATES - GOODS TAXABLE @ 4% :: cpt :: VAT Audit :: TDS :: ACCOUNTING STANDARDS :: VAT RATES :: ACCOUNTING STANDARD :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: ARTICLES ON INPUT TAX CREDIT IN VAT :: due date for vat payment :: empanelment :: articles on VAT and GST in India :: list of goods taxed at 4% :: form 3cd
 
 
« Service Tax »
 Goods and Services Tax: Beyond audit & scrutiny, dual control still a grey area
 India to levy service tax on freight for imports on delivered basis
 Income tax relief must be blended with additional tax measures
 9th GST Council inks breakthrough on dual control over tax payers, rollout deferred to July 1, 2017
 GST rollout uncertainty hits Budget 2017 calculations
 GST now set for July 1 roll-out, dual control hurdle finally over
 Grant of Registration under DVAT and CST
 Do not raise service tax, says Chamber
 Excise, service taxpayers to migrate to GST portal by Jan 31
 Centre, state governments work on formula for 'GST on high seas'
 What is service 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 2017 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