New Delhi: Most services are likely to attract a tax of 18 percent under the Goods and Services Tax (GST) as Union Finance Minister Arun Jaitley presents the Union Budget on February 1.
It will be interesting to witness whether the Centre raises the service tax rate from the existing 15 percent by at least one percentage point to 16 percent as a precursor to the rollout of GST.

However, the Centre and states have agreed to rollout GST from July 1, 2017, after which most services will turn costlier.

Also, a higher service tax, even for three months, will help the Centre partially offset the revenue loss after the GST kicks in, sources indicated.

Under GST, the service tax collections will be divided equally between the Centre and the states. A service tax closer to the GST rate will also help consumers avoid a greater price shock after the new system is rolled out.

Jaitley-headed GST Council has agreed on a four-slab structure -5, 12, 18 and 28 percent-along with a cess on luxury and ‘sin’ goods such as tobacco.

Within these, two standard rates of 12 percent and 18 percent could extend to a majority of the taxable goods.

ANI

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No.25/7/2016-CS-II(A)
Government of India
Ministry of Personnet Public Grievances and Pensions
Department of Personnel & Training

3rd Floor, Lok Nayak Bhawan,
New Delhi – 110 003.
Dated the 8th November, 2016

OFFICE MEMORANDUM

Subject: Filling up the posts of Senior Private Secretary in the Customs, Central Excise & Service Tax, Settlement Commission, Additional Bench, Chennai on deputation basis.

The undersigned is directed to refer to Department of Revenue’s Circular No.II/16/1/2015-SC dated 26.10.2016 (copy enclosed) on the subject mentioned above, for the information of all CSSS officers of this Department. All eligible and willing officers may, accordingly, apply through proper channel, in time so as to complete the process of routing the applications to Customs & Central Excise, Settlement Commission, Additional Bench; Chennai.

2. It may be noted that Cadre Clearance from CS.II Division will be required in case of Principal Private Secretary and above level officers of CSSS applying for deputation.

Encl: As above

(Umesh Kumar Bhatia)
Under Secretary to the Govt. of India
Tel: 24623157

To,
All Ministries/Departments (through website of DoP&T)

C.No.II/16/1/2015-SC

Dated: 26.10.2016

Applications are invited for filling up the Senior Private Secretary in the Customs, Central Excise & Service Tax, Settlement Commission, Additional Bench, Chennai on deputation basis:-

SENIOR PRIVATE SECRETARY

Pay Scale: Rs. 9300-34800+4800
Number of Posts: 3

Eligibility Criteria

Central Government employees:-

a) holding analogous post on regular basis; or
b) with three years regular service as Private Secretary in the posts carrying the pay scale of Rs.6500-200 – 10,500/- (pre-revised); or
c) with seven years combined service in the pay scale of Rs.500-9000 (pre revised) or Rs. 6500-10500 (pre-revised) or equivalent in the parent cadre/Department in the Stenographer cadre.

The period of deputation shall be initially for one year extendable up to three years. The pay of the officers/officials selected will be regulated in accordance with DOPT instructions. The maximum age limit for appointment shall not exceed 56 years as on the closing date of receipt of applications.

The application in the prescribed Proforma (Annexure-I) from eligible officers/officials who can be spared in the event of their selection may be forwarded directly to the Additional Commissioner at the address mentioned below within 30 days from the date of issue Advt. along with (a) up-to-date CR dossiers of the candidate concerned of photocopies of annual confidential reports for the last five years; (b) vigilance clearance report clearly ‘indicating that no disciplinary or criminal proceedings vigilance clearance report clearly indicating that no disciplinary or criminal proceedings are either pending or contemplated against the official concerned; (c) statement showing the minor/major penalties imposed, if any, and (d) integrity certificate.
Incomplete applications or applications not received through proper channel or applications received after the specified date shall not be entertained and would be straight-way rejected.

Applicants should address their applications to the “Additional Commissioner” and the same sent to the undermentioned address.

Additional Bench, Chennai
Customs & Central Excise, Settlement Commisison, Additional Bench,
2nd Floor, Narmada Block, Customs House,
33 Rajaji Salai, Chennai- 600001.

R.CHANDRASEKARAN)
Assistant Commissioner

Get Full circular

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New Delhi: In the run-up to GST rollout, the finance ministry has warned tax officials of disciplinary action if they go ahead with planned protests, including taking mass casual leave, on the budget day.

The All India Association of Central Excise Gazetted Executive Officers is opposed to any assessee of excise and service tax being moved to states in the new GST regime and has given notice for protest that includes lunch hour dharnas and mass casual leave on the budget day.

The revenue department on October 10 issued an order asking officials not to go on any protest and cited service rules that bar such action.

“GST is a major tax reform. All decisions will be taken by the GST Council, keeping in mind the interest of all concerned – the tax payer and officers. Against this background, you are advised to refrain from proposed course of action,” it said.

The order cited service rules that do not permit participation in demonstrations and strikes.

The service rules attached with the order stated that “disciplinary action should be taken against the prominent participants in the ‘gherao’ by striking officers, and absence from work on account of participation in such a protest should be treated as “unauthorised absence involving break in service”.

“The absence should not be regularised as leave of any kind,” the service rules said.

Rule 7 cited in the order states that no government service shall “engage himself or participate in any demonstration which is prejudicial to the interests of the sovereignty and integrity of India, the security of the state…”

The association plans to hold lunch hour dharnas on November 9, wearing black badge in office on December 7, day-long protest on January 5 and mass casual leave on budget day by all officers.

In its memorandum to Finance Minister Arun Jaitley, the association said the Central Board of Excise and Customs (CBEC) and its officers and employees have experience and expertise of more than 70 years in handling excise and service tax “which is missing with state officers”.

It wanted that “none of the assessees of central excise (to be levied CGST on supply of goods) and service tax (to be levied CGST on supply of services) should be transfered to states for the purpose of levy and collection of CGST by the officers of states”.

“All central excise and service tax assessees falling above the annual turnover of Rs 20 lakh should necessarily be controlled by the Centre and its officers only. No need to say we require a strong and powerful Centre in our federal system,” it added.

It wants CBEC and its officers only to collect C-GST and I-GST. “State government officials should be allowed to collect only SGST on intra-state supply of goods and services,” the body proposed.

PTI

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The Government has proposed the following in the Finance Bill, 2016 with regard to the National Pension System (NPS):

i. Allowing 40 per cent of the NPS corpus tax exempt on lump sum withdrawal.

ii. Waiving service tax on the NPS corpus utilized for purchase of annuity.

iii. The amount receivable by the nominee in case of death of the subscriber covered under NPS has been made tax exempt.

iv. One-time portability without any tax implication has been allowed to the subscriber for shifting from recognized provident fund to NPS.

v. One-time portability without any tax implication has been allowed to the subscriber for shifting from superannuation fund to NPS.

As per the provisions of the Finance Bill, 2016, 40 per cent of the pension corpus under NPS is proposed to be tax exempt on lump sum withdrawal. Also, the proposal in the Union Budget, 2016-17 for taxation of 60 per cent of provident fund corpus under the Income Tax Act, 1961 has been withdrawn by the Government. Employees’ Provident Fund (EPF) remains an Exempt Scheme.

However, EPF and NPS are different schemes available to separate categories of subscribers and they are not comparable on one-to-one basis.

This information given by Shri Bandaru Dattatreya, Minister of State (IC) for Labour and Employment, in reply to a question in Rajya Sabha today.

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While presenting the General Budget 2016-17 in Lok Sabha today, the Union Finance Minister Shri Arun Jaitley said that pension schemes offer financial protection to senior citizens. He proposed to make withdrawal up to 40% of the corpus at the time of retirement tax exempt in the case of National Pension Scheme(NPS). In case of superannuation funds and recognized provident funds, including EPF, the same norm of 40% of corpus to be tax free will apply in respect of corpus created out of contributions made after 1.4.2016. Further, the annuity fund which goes to the legal heir after the death of pensioner will not be taxable in all three cases.

He also proposed a monetary limit for contribution of employer in recognized Provident and Superannuation Fund of Rs. 1.5 lakh per annum for taking tax benefit.

He proposed to exempt from service tax the Annuity services provided by the National Pension Scheme (NPS) and Services provided by EPFO to employees. Also, he proposed to reduce service tax on Single premium Annuity (Insurance) Policies from 3.5% to 1.4% of the premium paid in certain cases.

PIB

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To shore up its revenues in order to spend more, the government may increase service tax to 16 percent from the current 14 percent, a move that would make many services costlier, according to a report by business news channel CNBC-TV18.

“In addition to the Swachh Bharat Cess of 0.5 percent already levied, sources say the service tax rate is projected to rise by 2 percent to 16 percent,” the channel reported.

If the government does raise the service tax rate, one would have to pay higher for restaurant bills, air tickets, mobile phones, to name a few, as the tax is collected from the end user.

The Swachh Bharat cess of 0.5 percent was levied with effect from 15 November, 2015, on all services that attract service tax.

The government is hard pressed to shore up its revenues for a probable hike in social welfare spending in view of the upcoming state assembly polls in Kerala, Puducherry, West Bengal, Tamil Nadu and Assam, which are crucial for the ruling BJP at the Centre to increase its tally in the Rajya Sabha.

On Wednesday, the government estimated a shortfall of about Rs 40,000 crore in direct tax collections, though it said that the same would be managed by a rise in indirect tax collections. The total taxes collected stood at Rs 10.66 lakh crore, 73.5 percent of the budgeted estimates of Rs 14.49 lakh crore for FY2016, it said in a statement.

The government has utilised the fall in crude oil prices to raise excise duty on petrol and diesel during the past three months to mop up an additional Rs 17,000 crore during the current fiscal.

The Union Budget for FY2016-2017 will be presented by union Finance Minister Arun Jaitley on Feb. 29, 2016. The budget session of Parliament commences on Feb. 23, 2016.

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“On the receipt of the document… in respect of the pending case, the jurisdictional deputy/assistant commissioner… will make a provisional payment of 80 per cent of the amount claimed as refund within five working days of the receipt of the documents,” a CBEC circular said.

The move will speed up sanction of the refund accumulated CENVAT credit to exporters of the services, it added.

It is also clarified that the decision to grant provisional payment is an administrative order and not a quasi-judicial order and should not be subjected to review.

This payment of 80 per cent of the refund shall be purely provisional based on the documents above and without prejudice to the department’s right to check the correctness of the claim in terms of the relevant notification, it said.

On the CBEC move, Nasscom said the circular has reiterated granting 80 per cent upfront refund within a week and the balance 20 per cent on scrutiny of applications.

This is applicable to service tax refund claims filed under Rule 5 of the CENVAT Credit Rules, 2004 (CENVAT Rules) on or before March 31, 2015.

“This scheme is applicable to cases that have not been disposed of so far. A claimant on submission of statutory auditor certificate certifying refund eligibility in the prescribed format and an undertaking to repay with interest in the case of refund adjustment, will receive 80 per cent refund amount within five days,” it said.

Source: NDTV

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Ministry of Finance
Press Information Bureau
Government of India

14-July, 2015

Some restaurants/hotels/eateries besides charging for the food and beverages are also charging ‘service charges’ in their bills. The proceeds of the ‘service charges’ are retained by the restaurants/hotels/eateries.

Some of the consumers have a misapprehension that these ‘service charges’ are being collected by the restaurant on behalf of the Government as tax.

It is clarified that these ‘service charges’ collected by the restaurants/hotels/eateries are retained by the restaurants/hotels/eateries and are not ‘service tax’ imposed by the Government.

It is further clarified that effective service tax rate in respect of services provided in relation to serving of food or beverage by a restaurant, eating joint or mess having the facility of air–conditioning or central air-heating in any part of the establishment is 5.6% (14% of 40%) of the total amount charged.

PIB

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New Delhi: The penalty in cases of customs duty fraud has been reduced by 10 per cent by the Finance Ministry.

Section 28 of the Customs Act, 1962, has been amended and now the amount of penalty payable in cases involving fraud, collusion, wilful mis-statement or suppression of facts with the intent to evade payment of duty, shall be fifteen per cent instead of 25 per cent.

Also, there will be a penalty not exceeding ten per cent of the duty sought to be evaded or Rs 5,000, whichever is higher, for improper export and import of goods.

Sections 112 and 114 of the Customs Act which, respectively provide for penalty for improper import and export of goods, have been amended by insertion of new clauses to provide for a penalty of up to 10 per cent of the duty sought to be evaded or Rs 5,000, whichever is higher, according to Finance Act, 2015.

The Ministry has also rationalised imposition of penalty on central excise duty and service tax evasions by fraud and other means.

In case of any wilful evasion of central excise duty, a penalty equal to the duty evasion will be payable. Similarly, the penalty will be hundred per cent of Service Tax amount involved in such cases.

A reduced penalty equal to 15 per cent of the Service Tax amount is to be paid if Service Tax, interest and reduced penalty is paid within 30 days of service of notice in this regard, the Act said.

There will be no penalty imposed on an assessee if the customs, excise duties or service tax are not properly levied, if those amounts along with interest are paid within 30 days of issuance of show-cause notices, it said.

The penalty waiver, which is part of Finance Act, 2015, that got President Pranab Mukherjee’s assent last month, is applicable in cases of fraud, collusion or wilful mis-statements.

PTI

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At present, Service Tax is chargeable on services provided by restaurants, eating-joints or messes which have the facility of air-conditioning or central air-heating in any part of the establishment at any time during the year in relation to serving of food or beverages. Restaurants, eating-joints or messes which do not have the facility of air-conditioning or central air-heating in any part of the establishment are exempt from service tax. In other words, only air-conditioned or air-heated restaurants are required to pay Service Tax.

In respect of such air-conditioned or air-heated restaurants which are required to pay Service Tax, 60% of the value is to be deducted from the total amount charged while applying the rate of Service Tax and tax is to be calculated on the balance 40%. With the increase in the rate of Service Tax to 14% (subsuming the Education Cesses) with effect from 1.6.2015, the effective rate of tax will be 5.6% of the total amount charged. Prior to 1.6.2015, when the rate of Service Tax was 12.36% (including Education Cesses), the effective rate was 4.94%.

PIB

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