Union Finance Minister Sh. Pranab Mukherjee has proposed to free all individual and sole proprietor service tax payers with a turn over to Rs. 60 lakh from the formalities of the audit. It has been observed that the number of assesses in service tax has grown manifold and a large number of them comprise individuals or sole proprietors with small turnovers. Any audit at their premises tends to dislocate their activities for the duration of the audit. It has also been proposed to give the benefit of three percentage points in interest on delayed payment to these service tax payers.

Audit relief for small service taxpayers proposed: exemption from audit formalities and reduced interest on delayed payments. Proposal to relieve small individual and sole proprietor service taxpayers from audit formalities when turnover does not exceed a specified threshold, removing on site audit requirements for eligible assesses; additionally proposes a three percentage point reduction in interest charged on delayed service tax payments for those taxpayers.