BOCW CESS ACT

[ramkishore gupta]

Please let me know that the amount deducted as Labour Welfare Cess @1% under 'The Building and Construction Workers 'Welfare Cess Act 1996 (BOCW ACT) is a tax??

[KASTURI SETHI]

Cess is a kind of duty or tax. CBEC has declared as duty. No difference whether duty or tax. It is not part of TDS.

[ramkishore gupta]

my query is labour cess charged on work bill exempted from calculation of service tax?????

[DR.MARIAPPAN GOVINDARAJAN]

In my view it is exempted.

[KASTURI SETHI]

Yes Sir. There is no Service Tax on tax. Cess is a tax or duty. No double taxation. Hence exempted.

[Ganeshan Kalyani]

No TDS on labour cess.

AI Summary

Labour welfare cess excluded from service tax base and not subject to tax deduction at source. Labour welfare cess under the Building and Construction Workers Welfare Cess Act is treated as a tax or duty and is excluded from the service tax taxable value; it is not subject to tax deduction at source because it is a statutory levy rather than consideration for services.