Tour Operator Services

[Ethirajan Parthasarathy]

When a tourist approaches a tour operator, the tour operator approaches another tour operator who raises a bill in the name of the first tour operator charging service tax after abatement.  The first tour operator raises a bill on the tourist for higher amount. In my opinion the first tour operator has to again charge service tax which is not eligible for any input credit.

Some times the First tour operator raises a bill for the tour for the like amount raised by the second tour operator & reflects certain amount as 'service charges'.  In this circumstances also, the total amount will be subject to service tax without any input. Kindly confirm whether my understanding is correct

[Naveen Jain]

MR. ethirajan parthasarathy,

 

Your understanding is correct.

And Operator 1 (raised bill on operator 2) or Operator 2( raised bill on tourist), who raised bill with abated service tax not eligible for input credit.

 

 

AI Summary

Tour Operators Must Charge Service Tax Without Input Credit When Engaging Another Operator Under Abated Tax Scheme A query was raised regarding the service tax implications when a tourist approaches a tour operator, who then engages another operator. The second operator charges service tax after abatement to the first operator, who then bills the tourist a higher amount. The question was whether the first operator must charge service tax again without input credit eligibility. The reply confirmed that the first operator must charge service tax, and neither operator is eligible for input credit on the abated service tax.