India Increases Service Tax Rate
- Sales Tax Rate Changes
- Jun 2, 2015 | Gail Cole
Effective June 1, 2015, the service tax rate in India increases from 12.36% to 14%.
The increase was anticipated, having been announced in the budget speech presented last February by Finance Minister Arun Jaitley. If all goes as planned, the higher rate of tax will “facilitate a smooth transition” to the imposition of a Goods and Services Tax (GST), which is expected to simplify India's tax system. Once a GST is implemented, it will “subsume service tax, excise and other local levies.” Implementation is expected to occur in April 2016 (moneycontrol.com).
The service tax is imposed on most (but not all) services, including the following:
- Airlines and railways
- Credit cards
- Event management
- Tour operators
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