Service tax on Rent Cab under reverse charges

[Krishan Gopal]

Sir, would you give clarification on service tax on renting of a motor vehicle under reverse charges-

what is the difference between abated value and non abated value, if non abated value then service provider pay service tax on 50% value of service.

Gopal

AI Summary

Exploring Service Tax on Motor Vehicle Rentals: Abated vs. Non-Abated Values under Notification No. 26/2012-ST A discussion on a forum addresses the service tax implications on renting a motor vehicle under reverse charges. The main focus is on the distinction between abated and non-abated values. Non-abated value refers to the full service charge, with the service provider paying tax on 50% of the value. Abated value involves paying tax on a reduced percentage, subject to conditions under Notification No. 26/2012-ST. Participants clarify these concepts, referencing specific notifications and amendments, including Notification No. 30/2012, which dictates a 50% tax on car hire charges effective from October 2014.