Service tax from 14.5% to 15%

[SURYAKANT MITHBAVKAR]

Bydget 2016 has proposed to impose a cess, called the Krishi Kalyan Cess. @0.5.% on all taxable services.

The new effective service tax will be @15%

Please let us know which date it will be effective and under which nofication.

[Rajagopalan Ranganathan]

Sir,

KKC will come into effect from 01.06.2013.

[KASTURI SETHI]

KKC has been levied vide clause 158 Chapter VI of Finance Bill, 2016 (Now enacted w.e.f.14.5.16). It is applicable from 1.6.16.

[Ganeshan Kalyani]

Sir, Krishi Kalyan Cess is applicable on all taxable services w.e.f. 01.06.2016. This was proposed in Finance Bill 2016 which got assented and become an Act. Thanks.

AI Summary

Krishi Kalyan Cess raises the effective service tax rate and applies to all taxable services from commencement. Krishi Kalyan Cess was introduced as an additional levy on all taxable services, implemented by the Finance Bill, 2016 (clause 158, Chapter VI) and given legal effect upon enactment in May 2016, with administrative application from the statutory commencement date; the cess is imposed on the same taxable event and base as service tax and is collectible through existing service tax compliance mechanisms.