Exemption to sub-contractors in SEZ

[Rajeev Kalra]

Are sub-contractors exempted from Service tax for providing services to main contractor who in turn provides services to SEZ develpoer.

AI Summary

Sub-contractors' service tax exemption depends on service location; exempt only if services are entirely within SEZ. A query was raised regarding the exemption of sub-contractors from service tax when providing services to a main contractor who serves an SEZ developer. The response clarified that sub-contractors are not automatically exempt from service tax. The exemption depends on the location of the services provided. If the sub-contractor's services are entirely within the SEZ, they are exempt from service tax. However, if services are rendered outside the SEZ, the sub-contractor must pay the service tax.