TRAVEL AGENT - UNDER WHICH CATEGORY AND AT WHAT RATE SERVICE TAX NEED TO BE PAID

[Asked by Guest]

IN CASE OF TRAVEL AGENT BUYING AIR TICKET FROM ITAT AGENT AND SELLING TO CUSTOMER UNDER WHICH CATEGORY SERVICE TAX IS TO BE PAID AND WHAT IS RATE.

[Ravi Chopra]

Technally speaking, there is no specific head which cover this service. However, most relevat and suitable head for charging service tax on this category is Business Auxiliary Service. The service tax is payable on the value of commission received by them.

AI Summary

Business Auxiliary Service: tax applies to travel agents' commission when reselling tickets to customers as taxable service.
The most appropriate classification for a travel agent reselling air tickets purchased from an IATA agent is Business Auxiliary Service, and service tax is payable on the value of the commission received by the travel agent rather than on the full ticket price.