S.Tax on package offer by Hotel.

[Guest]

Sir,

My hotel have received client from Russia . W e have offered the package i.e airport lifting/ stay in hotel/food/and providing car and all for  other visits to be made by them for the purpose they have come hear plus sightseeing all this for 15 days. The package amount is Rs.29 lakhs received  in foreign currency. Will they have to be charged service tax and what notif. is there to claim exemption from STax as they have paid in foreign currency. Some say there is exemptioin if received in foreign currency.Please advice.Regards

Pradip 

[Brijesh Verma]

AS per place of provision rules...services in relation to Hotel accommodation shall be treated to have been provided in India only and therefore the question regarding ST Exemption doesn't arise. 

Further, as far as taxability is concerned, the tax shall be levied after taking abatement as per NN 26/2012-ST dated 20.06.2012

AI Summary

Place of provision: hotel accommodation services treated as provided in India; taxable subject to available abatement. Services in relation to hotel accommodation supplied under a bundled package are treated as provided in India, so payment in foreign currency does not alone exempt them from service tax; taxability is determined after applying the prescribed abatement to the package consideration, with service tax leviable on the net taxable portion.