TOUR OPERATOR SERVICE

[Kunal Aggarwal]

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.

AI Summary

Gross amount charged governs service tax liability; reseller's taxable value is invoice-based but input credit is available.
Valuation for service tax is based on the gross amount charged, which includes any amounts received before, during or after the service and falls within the statutory definition of 'consideration'. Taxable value is determined from that gross amount less any admissible abatement. A tour reseller can take credit for service tax charged by the tour seller, so input tax credit may offset the reseller's liability even though the declared base is the gross amount charged.