TaxTMI 
TaxTMI 
abatement in service tax
18 Dec 2015 
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Abatement in service tax: taxable value reduced to an abated base, with CENVAT credit typically disallowed.
Abatement reduces the taxable base for specified services so service tax is levied on the abated invoice value; where abatement applies providers generally cannot claim CENVAT credit on inputs, input services, or capital goods. Abatements are used when segregating component values is difficult or for administrative convenience, and serve as a policy tool to achieve practical rate reduction while protecting revenue. (AI Summary)
Abatement reduces the taxable base for specified services so service tax is levied on the abated invoice value; where abatement applies providers generally cannot claim CENVAT credit on inputs, input services, or capital goods. Abatements are used when segregating component values is difficult or for administrative convenience, and serve as a policy tool to achieve practical rate reduction while protecting revenue. (AI Summary)
what is the role of abatements in service tax