TaxTMI 
TaxTMI 
TaxTMI 
service tax on freight paid
d.v. gupta
we are a NGO and paying freight to transporter every mont of Rs. 10000.00 for life jacket etc supplied to flood affected people. are we liable for payment of service tax on freight paid. if yes ,then at what rate.
NGO Questions Service Tax Liability on Freight for Life Jacket Transport; Debate Over Exemption for Relief Materials Transported by Road. An NGO inquired about the liability for service tax on freight paid to transport life jackets for flood victims. One respondent stated that NGOs, classified as societies, are liable for service tax on Goods Transport Agency (GTA) services, but can claim a 75% abatement, reducing the effective tax rate to 2.575%. Another respondent agreed but argued that service tax should only apply to commercial transactions. Citing a notification exempting relief materials from rail transport tax, they suggested the same exemption should apply to road transport, potentially exempting the NGO from the tax. (AI Summary)