TaxTMI 
TaxTMI 
Dear Experts,
Service tax has been introduced on inward & outward transportation of goods by Sea. Kindly confirm Is service tax now payable on Ocean freight paid to shipping and air lines ??
Service tax on ocean freight-on import export transportation of goods by Sea
01 Mar 2016 
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Service tax on ocean freight: cross border sea carriage now taxable and importers may be liable under reverse charge.
The 2016 Budget omits the negative-list exclusion for carriage of goods by vessel up to the customs station of clearance, making ocean freight taxable where the recipient is in India; foreign providers render the Indian recipient liable under reverse charge while Indian shipping lines pay under forward charge. Air carriage remains exempt by notification. Amended Cenvat rules permit credit for inputs and input services for services from India to outside India, and service tax on such carriage is excluded from customs valuation. Practical issues include treatment of freight forwarders, combined invoices and potential double taxation. (AI Summary)
The 2016 Budget omits the negative-list exclusion for carriage of goods by vessel up to the customs station of clearance, making ocean freight taxable where the recipient is in India; foreign providers render the Indian recipient liable under reverse charge while Indian shipping lines pay under forward charge. Air carriage remains exempt by notification. Amended Cenvat rules permit credit for inputs and input services for services from India to outside India, and service tax on such carriage is excluded from customs valuation. Practical issues include treatment of freight forwarders, combined invoices and potential double taxation. (AI Summary)