New Service Tax Rate of 14% to Come Into Effect From June 1, 2015 |Cerule India

The new service tax rate of 14 per cent will come into effect from June 1, the Finance Ministry notified on Tuesday, in a move that will make eating out in restaurants, insurance and phone usage expensive, among many other things.

The service tax is currently levied at the rate of 12.36 per cent including education cess.

Mr Jaitley had in his Budget speech said that to facilitate a smooth transition to levy of tax on services by both the Centre and the states, it is proposed to increase the current rate of service tax plus education cess from 12.36 per cent to a consolidated rate of 14 per cent.

Service tax is levied on all services except a small negative list. Advertising, air travel, services of architects, certain type of constructions, credit cards and event management are some of the services which attract this tax.


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