Commission paid to foreign agent

[chander parkash]

WHETHER THE COMMISSION PAID TO FOREIGN AGENT ON EXPORT SALES IS EXEMPT? IF HE IS ALSO NRI?

[Surender Gupta]

These cases are borderline cases. I believe that the legislature should come forward to issue some clarification in this regard. However, the important point of consideration is that where and to whom the services has been provided. And in this case service would have been provided into India for the making of sales outside India. Service Tax shall be payable on the Commission paid to foreign agent on export sales. Further, there is no difference that such foreign agent is NRI or otherwise.

Yes,

AI Summary

Service tax liability: commission to foreign agents on export sales remains taxable as service provided in India.
The commission paid to a foreign agent for export sales is treated as a service provided into India and is therefore taxable under Service Tax; the agent's status as an NRI does not alter this tax liability.