New circular to remove ambiguities on service tax

By Staff
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Google Oneindia News

New Delhi, May 30 (UNI) Central Excise and Service Tax (CBEC) today announced that it will come out with a comprehensive circular sometime between June 12-15, clarifying all ambiguities about 100 services and henceforth only CBEC would frame new circulars on service tax.

''The government is aware of inconveniences that trade and business has been encountering on service tax front,'' said CBEC member P C Jha in the 'National Seminar on Service Tax: The Changing Dimensions', organised by industry chamber Assocham.

The board will finalise its circular and clarify its stand on various service tax relating issues numbering 100, he added.

He said the government has already withdrawn 48 circulars and the new circular will completely clarify all issues relating to service tax and it is being given final touches by highest authorities concerned.

Mr Jha clarified that unlike in the past when sometimes the source of a circular were either the CBEC or Director General service tax, leading to inconvenience in its drafting pattern, would now be completely curbed with the origin of all circulars being the board.

Ambiguities arising out of service tax imposition would be clarified as far as possible but warned the trade and industry that questioning the constitutional validities on imposition of service tax as regards to works contract and service contract is misplaced as the government consulted Law and Justice Ministry on the issue, he added.

Mr Jha promised that gray areas about service taxes would be adequately addressed as the government in future would earn the mandated revenue from service tax, the extent of which has already exceeded Rs 37,500 crore in fiscal 2006-07 and the target for 2007-08 for service tax is Rs 50,200 crore.

For better service tax revenue collection, the government would shortly open up large service tax paying units, one which is already functional in Bangalore and the new such centres will emerge in cities like Chennai, Kolkata, Delhi, Hyderabad, Pune, he informed.

UNI

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