https://www.taxtmi.com/article/detailed?id=926 Banks and card issuers have been levying service tax on credit card finance charges, late payment fees and similar penal or compensatory charges despite these amounts being interest or damages and therefore excluded from taxable service. Reliance on an old departmental circular is incorrect because S.67 principles and Rule 6(2)(iv) of the Service Tax Valuation Rules, 2006 exclude interest from the value of taxable services; the rule applies to all service providers. The article urges consumer awareness, a clarifying circular, and coordinated action to address improper collections. en-us Fri, 27 Aug 2010 00:00:00 +0530 Sat, 28 Aug 2010 06:56:12 +0530 TaxTMI RSS Generator https://www.taxtmi.com/article/detailed?id=926 Banks and card issuers have been levying service tax on credit card finance charges, late payment fees and similar penal or compensatory charges despite these amounts being interest or damages and therefore excluded from taxable service. Reliance on an old departmental circular is incorrect because S.67 principles and Rule 6(2)(iv) of the Service Tax Valuation Rules, 2006 exclude interest from the value of taxable services; the rule applies to all service providers. The article urges consumer awareness, a clarifying circular, and coordinated action to address improper collections. Articles Service Tax Fri, 27 Aug 2010 00:00:00 +0530 https://www.taxtmi.com/article/detailed?id=926