New Delhi, May 20: Start saving money now as you will have to pay more to avail some useful services from next month.
Reportedly, new service tax which was announced in the budget 2015-16 by Finance Minister Arun Jaitley will come into effect from June 1.
Here is all you should know about it
- The government has announced that from June 1 new tax of 14 per cent will be effective
- Currently the service tax is levied at the rate 12.36%, including education cess.
- This was announced by the government in the Union Budget but couldn't be implemented from April 1.
- In his Budget speech, Jaitley had 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 present rate".
What will be costly now?
- One will have to pay more money as tax will be levied on all services, expect a small negative list.
- Using cabs and eating in restaurants will put extra burden on your pocket.
- Similarly, with the new service tax paying credit card bill, insurance policy and air travel will also become costly.
- Reportedly, service tax will be increased from 0.6 per cent to 0.7 per cent for domestic flight.
- This will be even more (from 1.2 to 1.4 per cent) for international flight.
- On insurance front, for first year of the policy service tax will become 3.5 from 3 per cent.
- Apart from these, advertising, services of architect, certain type of constructions, event management, and tour operator are some of the other important services which will pinch your pocket.