Latest Expert Exchange Queries

GST Demo Service software link: https://ims.go2customer.com
Username: demouser Password: demopass
Get your inventory and invoicing software GST Ready from Binarysoft info@binarysoft.com
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) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
 
 
 
 
Popular Search: ARTICLES ON INPUT TAX CREDIT IN VAT :: Central Excise rule to resale the machines to a new company :: TAX RATES - GOODS TAXABLE @ 4% :: TDS :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: cpt :: VAT Audit :: form 3cd :: ACCOUNTING STANDARD :: VAT RATES :: list of goods taxed at 4% :: articles on VAT and GST in India :: due date for vat payment :: empanelment :: ACCOUNTING STANDARDS
 
 
Service Tax »
 The way ahead for goods and services tax
 Goods & Service Tax (GST): Recent Clarifications
 Tax payers can see status of returns filed on GSTN portal
 Export And Import Of Goods Under GST
 The Finance Resolution And Deposit Insurance Bill, 2017
 Payment made in revenue sharing deal exempt from service tax
 India seen posting stronger growth as businesses adjust to new tax
 GST High Powered Committee On Return Filing - Representation by GST Research Foundation
  Changes In Central Goods And Services Tax Rules, 2017
 GST return filing to be a breeze for small businesses
 Changes In Central Goods And Services Tax Rules, 2017

Software firms confused over service tax
June, 18th 2008

Inclusion of a new services category--Information Technology Software Services-- within the ambit of Service Tax legislation has created confusion among the software firms in India. The levy of this new service along with other services has become effective from May 16, 2008.

Post the notification many feel that from May 16, 2008, packaged software will attract 12.36 per cent of service tax. So far, packaged software attracts Value Added Tax (VAT) of 4 per cent and 12 per cent of excise duty.

The confusion arises as the notification does not make a clear demarcation of whether software' is to be sold as a good and hence liable for sales tax (VAT) or considered as services' and liable for a service tax.

Packaged software are products that are sold off the shelf. Some of the products that would fall under this are from, Microsoft, Autodesk, Adobe and several security software packages for the computers. This will also include accounting software from Tally.

According to industry players service tax, payable to the central government, is applicable when a service is offered. While VAT is applicable when a product is sold.

Som Mittal, President, NASSCOM said: "Service tax, VAT, excise duty all are issues that have come up relatively recently in our sector and sometimes there may be possible anomalies in these. Since software is sold both as a product and service, it is liable to be subject to multiple interpretations, such as the case now. NASSCOM is continuously working towards solving such issues on an ongoing basis. We are in discussion with the various stakeholders on this issue as well and are looking at resolve it at the earliest."

Software providers, distributors, vendors and customers are all in a state of confusion and are waiting for some sort of clarification from the government. "The recent announcement has no clarity as to the implications. How can one ask for service tax on something that has been declared as goods? Besides there is no clarity whether VAT is to paid on service tax or the other way round," said a spokesperson of a leading distribution firm.

When contacted Microsoft, a spokesperson said: "The government has made its policy clear that it intends to subject all software to either service tax or excise duty. Certain aspects of the new service tax provisions are not very  clear with respect to their application to software products. We intend to work with industry organisations towards  getting a clarification from the government. Regarding impact on our distribution channel, service tax paid by both service and manufacturing sectors is generally available as an input credit, so cascading impact of the new levy should be limited."

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Software Outsourcing Company Offshore Software Outsourcing Software Outsourcing Company India Offshore Outsourcing Company India Software BPO Software Business Process Outsourcing Software Outsourcing India Offsho

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