Service tax on incentive

[Guest]

Dear sir,

I am service receiver, please tell me, service tax will be applicable on incentive of erection service.

[DR.MARIAPPAN GOVINDARAJAN]

Please inform the nature of incentive.

[KASTURI SETHI]

As per Section 67 (3), Service Tax is applicable on the amount of incentive. Note the language, 'Any amount.......' Also see the definition of the term 'Consideration'.

[Ganeshan Kalyani]

As per section 67 consideration includes any amount that is payable for the taxable service provided or to be provided. Any amount will include 'incentive' also. Thanks.

AI Summary

Service tax applicability on incentives for erection services affirmed; incentives form part of consideration and are taxable. Service tax applies to incentives related to erection services because incentives are included within the statutory concept of consideration; any amount payable for a taxable service, including incentives, must be treated as part of the taxable value and assessed for service tax.