TaxTMI 
TaxTMI 
TaxTMI 
| Summary of changes being made by Finance Bill 2015 with their effective dates - Service Tax |
| With immediate effect (from 1.3.2015) |
| (i) Shifting the liability of payment of service tax on aggregator of a service where service is provided under the brand name of the aggregator |
| (ii) Amendments in rules 4,4A and 5 of the Service Tax Rules, 1994 |
| (iii) Certain amendments in the Cenvat Credit Rules - digitaly signed invoice |
| (iv) Rescinding of notification No. 42/2012-ST |
| (v) Extending the scope of advance rulings to resident firms |
| With effect from the 1st day of April, 2015 |
| (i) Rationalization of exemptions at S. Nos. 12, 14, 16, 20, 21 and 29 of notification No. 25/2012-ST |
| (ii) Omitting the entry at S. No. 32 in notification No. 25/2012-ST |
| (iii) New exemptions for,- |
| • Precondition, pre-cooling, ripening, waxing, retail packing, labeling of fruits and vegetables |
| • Service by a Common Effluent Treatment Plant operator |
| • Varistha Bima Yojana |
| • Ambulance services |
| • Admission to a museum, zoo, national park, wild life sanctuary, and a tiger reserve |
| • Service provided by exhibitor of movie to a distributor or an AOP consisting of exhibitor as one of its member |
| • Transport of export goods by road from the place of removal to a land customs station |
| (iv) Change in abatement rates and conditions thereof for transport of passengers and goods by train; transport of goods by road by a GTA; transport of goods by vessels; executive/business class travel by air; and withdrawal of abatement on services provided in relation to chit |
| (v) Amendment in reverse charge mechanism,- |
| • To prescribe full reverse charge on manpower supply and security service provided by individual, HUF, partnership firm to a body corporate |
| • Prescribing reverse charge on service provided by a mutual fund agent, mutual fund distributor and agents of lottery distributor |
| (vi) Amendment in rule 4(7) of the Cenvat Credit Rules to allow credit of service tax paid by recipient of service in partial reverse charge immediately on payment of tax |
| Changes in the Finance Act, 1994 that would get incorporated on enactment of the Finance Bill 2015 |
| (i) Insertion of new definition to specify the term “government” [section 65 B (26A)] |
| (ii) Insertion of a new Explanation in the definition of service [section 65 B(44)] |
| (iii) Insertion of an illustration in sub-section (1) of section 66F(1) to explain the scope of this subsection |
| (iv) Amendment in the definition of the terms “consideration” in section 67 |
| (v) Amendments in sections 73, 76 and 78. |
| (vi) Insertion of transition provision by way of section 78B |
| (vii) Omitting section 80(viii) Amendments in section 86 |
| (ix) Amendments in the provisions relating to Settlement Commission |
| (x) Omitting of rule 6 (6A) of the Service Tax Rules |
| With effect from a date to be notified after the enactment of the Finance Bill, 2015 in respect of each provision |
| New Service Tax rate |
| Swachh Bharat Cess |
| Amendments in the Negative List (section 66D) and definitions (section 65B), namely,- |
| (i) Omitting the definitions of the terms “amusement facility”[section 65 B (9)], “entertainment event” [section 65 B(24)], and entry |
| (j) in section 66D |
| (ii) Amendments in the definition of terms “process amounting to manufacture or production of goods” [section 65 B (40)] and entry (f) in section 66D |
| (iii) Omitting the definition of the terms “support service”[section 65 B (49)], and amendment in section 66D(a) (iv) |
| Amendment in S. No. 30 of notification No. 25/12-ST to exclude job work in relation to alcoholic liquor for human consumption from the scope of this exemption |
| Insertion of a new entry at S. No. 47 of notification No. 25/12- ST to exempt services by way of (i) right to admission to exhibition of film, circus, dance or theatrical performances including drama, or ballet; (ii) recognized sporting event; and (iii) admission to other events where the consideration for admission is upto ₹ 500; |
| Amendments in alternative rates of service tax provided for air travel agent, insurance service, money changing service and service provided by a lottery distributor and selling agent in rule 6(7), 6(7A), 6(7B) and 6(7C) of the Service Tax Rules. |
Servic tax amendments at a glance with effective dates
Deepak Aggarwal
Service tax amendments shift aggregator liability and expand reverse charge, with staged implementation and new cess notification. Finance Bill 2015 amends the Service Tax regime by staging changes: effective 1 March 2015 it moves tax liability to aggregators for branded services, updates Service Tax Rules and Cenvat invoice requirements, rescinds a notification, and extends advance rulings to resident firms. Effective 1 April 2015 it rationalizes and adds targeted exemptions, revises abatement rates, expands reverse charge liabilities for manpower, security and specified agents, and allows recipients to take Cenvat credit on partial reverse charge upon payment. The Bill also revises definitions, procedural provisions and contemplates a new rate and a separate cess to be notified after enactment. (AI Summary)
