We are participating in a exhibition which will be held in India. Exhibition charges will be paid by us to the event running company along with applicable taxes. Since we are distributors, we will be displaying the products of OEM manufacturers.
OEM manufacturer who is in India is willing to reimburse 50% of event participating cost to us.
please let us know whether this reimbursement attract Service Tax ?.
Regards
saravanan.
Service Tax Not Applicable on Reimbursement Without Markup for Event Costs: Expert Clarifications on Current Rules A distributor participating in an exhibition in India inquired about the applicability of service tax on a 50% reimbursement of event participation costs from an OEM manufacturer. An expert clarified that there is no service tax liability on the reimbursement if no markup is included, as the service tax has already been paid on the initial transaction. The discussion highlighted that since the distributor does not provide any service to the manufacturer, the reimbursement does not constitute taxable consideration. Another expert agreed, emphasizing that the reimbursement is not taxable under the current rules. (AI Summary)
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