TaxTMI 
TaxTMI 
Hi, As per Union Budget 2016 -17, Any services provided by Govt. to business entity will be liable to service tax under RCM. Is services of electricity, telecom & water by govt. ie. BSNL, MSEB and water bill from municipality liable to service tax under reverse charge?
service tax under reverse charge - government services
07 May 2016 
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Reverse charge on government-provided services may extend to supplies to business entities, subject to exclusions and exemptions.
Reverse charge liability from the Union Budget 2016-17 subjects services provided by the government to a business entity to service tax under RCM, while excluding services to individuals; municipal bodies qualify as local authorities, entities like BSNL and MSEB may not be wholly government, and specified exemptions and exceptions apply. The note questions whether supplies such as electricity-billed by unit consumption-are sales rather than services, affecting their susceptibility to service tax under reverse charge until enactment clarifies scope. (AI Summary)
Reverse charge liability from the Union Budget 2016-17 subjects services provided by the government to a business entity to service tax under RCM, while excluding services to individuals; municipal bodies qualify as local authorities, entities like BSNL and MSEB may not be wholly government, and specified exemptions and exceptions apply. The note questions whether supplies such as electricity-billed by unit consumption-are sales rather than services, affecting their susceptibility to service tax under reverse charge until enactment clarifies scope. (AI Summary)