Amendments in Service Tax
Commercial or Industrial Construction and Construction of residential complex:
Ø Section 65(105)(zzq) and Section 65(105)(zzzh) : Builders/developers are now liable to service tax on sale consideration received before grant of completion certificate by the competent authority.
Ø Therefore if a builder/developer receives the entire sale consideration for flats after issue of completion certificate it will not be taxable.
Port Services, Other port services and Air port services:
Section 65(105)(zn) and Section 65(105)(zzl) Section 65(105)(zzm): Any services provided by any person within a port / airport, whether authorized or not by port / airport authorities will be taxable services.
Classification of service u/s 65A will not apply to such service.
Commercial Training or Coaching centre:
Section 65(105)(zzc) : Commercial training or coaching centre includes any centre or institute imparting training or coaching for consideration whether registered as trust, society, or non-profit organization.. This has been brought into the tax net retrospectively form 01st July,2003.
Also vocational training institutes are exempted from service tax vide notification no 24/2004-ST dtd 10-9-2004, but the definition of vocational training institute is substituted to provide that only industrial training centres affiliated to National council of Vocational training will be covered. Refer notification no 3/2010-ST dtd 27-2-2010
Sponsorship Services:
Section 65(105)(zzzn) : Sports sponsorship which was earlier excluded has now been brought in to the tax net by removing the exemption. So services provided to any person including in respect of sports are now liable to tax.
Air Passenger Transport Services:
Section 65(105)(zzzo) : Aircraft operator providing services to passengers embarking in India for domestic or International air travel in any class is now liable to service tax.
Auction of Property Services
Section 65(105)(zzzr) : Under auction of property services, auction of private property by government is now liable to service tax. The exemption is only available for auction of Government property whether immovable or movable.
Renting of Immovable property services:
Section 65(105)(zzzz) : Renting of immovable property either furnished or unfurnished including leasing of vacant land are now taxable. This is a retrospective amendment overriding the Delhi High
Court judgment (supra) and is effective from 1st June 2007.
Management of Investment under ULIP Scheme:
Section 65(105)(zzzzf) : Under Management of Investment under ULIP services, service tax is payable on actual amount charged by the insurer for management of funds under ULIP or the maximum amount of fund management charges fixed by the insurance Regulatory & development Authority (IRDA) whichever is higher.
Information Technology Software Services:
Section 65(105)(zzzze) : Information Technology Software Services presently only covered services provided for commercial use. It now covers services provided for personal use also.
WITHDRAWALS OR AMMENDMENTS IN EXEMPTIONS
Transport of Goods By Rail:
Section 65(105)(zzzp) : Transportation of good by rail will now be covered as the government has withdrawn the exemption.
Transportation of Goods By Road:
Transportation of food grains or pulses by road will now be exempted from services tax along with transportation of fruits, vegetables, eggs and Milk.
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