Service tax on commission to an indian for foreign services

Queries 873 views 5 replies

 

Dear Members,

If an Indian arranges US artist to perform in an event in Dubai and He received Rs X Lacs from Dubai and Pay Rs Y Lacs to US artist. Whether service tax will be applicable to Indian and If yes at what value

Regards

Kanhaiya Rathi

Replies (5)
Yes Service tax will be applicable. As per the amendment made in service Tax, there is no limitation on the place where service is provided, may it be in taxable territory or not, you need to deposit service tax on the amount of money received in foreign currency. In that case if you want to reduce your liability, then break the transaction receive only the share which pertains to you and instruct to send the share of the artist directly from Dubai.

But both the servvices are fully provided outside India ... Can you please refer the amendment or relevant provisions

Please make it clear that service has been provided in Dubai but the arrangements where initiated in India. hence the question of providing two services is not correct. Since you have arranged for the services provided outside the taxable territory, the onus of discharging ST liability is upon you as a service provider.

Dear Ajit

In that case he wil have to pay service tax on import from US on Amount X and In case of Export the service will be exempt...Whether he can claim refund on Import part as the service is used for export

 

Thanks

Kanhaiya

The principle of Service Tax is not the one which you are talking about. It is simply that you have provided a service and you need to pay service tax on the same. From where the question of import, export, and subsequent refund comes.


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