Hi,
A tour reseller is selling tour package after adding markup. Tour seller is charging 4.35% Service tax on tour and after that Tour reseller add markup and sold it to customer. what should be the sevice tax applicablity on that on point of Tour Reseller. He has to pay service tax on markup only or full invoice amount.
Tour Reseller Liable for Service Tax on Full Invoice, Not Just Markup, Per Finance Act Section 67(3) A tour reseller inquires about the service tax applicability on tour packages sold with a markup. The primary question is whether the reseller should pay service tax on the markup alone or the full invoice amount. According to Section 67(3) of the Finance Act, 1994, the gross amount charged, including any markup, is considered for service tax calculation. Additionally, the reseller can claim credit for the service tax already charged by the tour seller. The consensus among the forum participants supports this interpretation, affirming that the reseller is liable for service tax on the entire gross amount. (AI Summary)
Service Tax
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