TaxTMI 
TaxTMI 
This query is in responce to the reply given to Mr.Chander Prakash for his query dated 31st March: Commission services is covered under Business Auxiliary Services, which is covered in Section 65 (105)(zzb) of the Act. But, as per draft of Taxation of Services (provided from Outside India and received in india) Rule 2006,the said Clause (zzb) is not covered. Therefore, pl. explain as to how the commission paid outside India shall be treated as taxable service within the preview of service tax
Category - Commission paid outside India
12 Apr 2006 
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Taxability of cross-border commission depends on recipient location; commissions to persons outside India are not taxable.
Commission services fall under Business Auxiliary Services for service tax purposes, but the draft Taxation of Services Rules apply extraterritorially only when the recipient is located in India; therefore commissions paid to persons located outside India are not taxable under the draft rules, while commissions paid to recipients located in India may be taxed. (AI Summary)
Commission services fall under Business Auxiliary Services for service tax purposes, but the draft Taxation of Services Rules apply extraterritorially only when the recipient is located in India; therefore commissions paid to persons located outside India are not taxable under the draft rules, while commissions paid to recipients located in India may be taxed. (AI Summary)