Service Tax to be increased by 15 percent from 1st June
Posted on: 30/May/2016 2:23:23 PM
From 1st of next month, the service tax is being increased by 15 percent. Because of this land registration fees, hotel and phone bills will increase. The Union Government is taking several steps to increase the revenue by increasing the taxes. While presenting the Budget 2015, the Finance Minister had increased the Service Tax Rate from 12.36 percent to 14 percent. This new rate of Service Tax at the rate of 14 percent was applicable from 1st June 2015. Moreover from 15th Nov 2015, Swachh Bharat Cess at the rate of 0.5 percent also got applicable. Therefore the effective rate of Service Tax is currently at 14.5 percent with effect from 15th Nov 2015.
In this year budget in order to in order to improve initiatives relating to agriculture and welfare of farmers a new Krishi Kalyan Cess was introduced. The 0.5 per cent Krishi Kalyan Cess announced in the Union Budget on all taxable services comes into effect June 1.
The Modi government has increased service tax from 12.36 per cent to 15 per cent (including the two cesses). The Krishi Kalyan Cess will make a host of services costlier, like visits to beauty salons, spas, gyms, courier services, credit and debit card-related services, chartered accounts, architects, insurance and demands raised by real estate builders for housing projects, among others.
