Rent-a-car

[Ganeshan Kalyani]

Dear Sir,

I would request to briefly explain with all scenario for applicability of service tax under reverse charge is case of rent a car.

As a service recipient whether service tax is payable under following circumstances.

1) A motor car hire - Non-air-conditioned

2) A motor car hire - Air-conditioned

3) A bus for pick-up and drop for employee from home to factory and back - Non-Air-conditioned.

4) A bus for pick-up and drop for employee from home to factory and back - Air-conditioned.

5) A metered taxi is hired whether air-conditioned or non-air-conditioned is exempt from service tax (hope i am right on this)

6) A radio taxi is hired whether air-conditioned or non-air-conditioned is taxable (plz validate my understanding)

7) A air-conditioned or non-air-conditioned bus is hired for a Finance conference to be held at different location. (whether service tax is payable)

I would request to share your view in above scenario where most of the tax executive are scratching there heads for clarity. It would be clear understanding to all the users.

regards,

ganesh

AI Summary

Service Tax Applies to All Taxis, Including Radio Taxis with GPS/GPRS; Clarification Advised for Disputes on GPS Necessity. A user inquired about the applicability of service tax under reverse charge for various hired vehicles, including non-air-conditioned and air-conditioned cars, buses for employee transport, metered and radio taxis. The responses clarified that service tax is applicable to radio taxis, regardless of air-conditioning, as defined by having two-way radio communication and GPS/GPRS tracking. The discussion emphasized that service tax applies to all types of taxis, with some disagreement on the necessity of GPS for tax applicability. It was suggested to seek further clarification from relevant authorities if needed.