services of consultant to us based company

[Abhishek Panicker]

Let me make it clear. I am not a Tax practitioner. Considering that I used to work long ago in the Indirect Tax domain, I was asked a service tax query. I thought I could use this platform to assist the queryist. The individual got an offer of being appointed as a Marketing Consultant to a US based company. They would pay him in USD every month and the foreign company does not have any office in India. Is this Consultant required to pay service tax? My opinion is that since the service recipient is in a non-taxable territory and the consulting fees are received by the provider in USD there cannot be any liability of ST. Informed netizens on this forum may advise me. I found this link also useful http://www.business-standard.com/article/sme/service-tax-not-payable-if-recipient-of-service-is-located-abroad-115030901142_1.html

Thanks in advance.

AI Summary

Export of service: consultancy paid in foreign exchange qualifies as export under rule criteria and is not subject to service tax.
A marketing consultancy provided by an Indian-based provider to a US-based recipient, with payment in convertible foreign exchange and where the place of provision is outside India and the service is not on the negative list nor between distinct establishments of the same person, qualifies as an export of service under Service Tax Rules and does not attract service tax; registration is not required unless the provider intends to claim input tax refund, in which case registration and filing of returns are necessary.