Service Tax Definition, Negative List

Do you know that from 01.07.2012, service tax would be applicable on all services except a few? The services in the ‘Negative List’ are excluded from the purview of Service Tax. The following services are part of the negative list:

Negative List –

  1. Services provided by Govt. or Local authority
  2. Services provided by RBI
  3. Services by a Foreign diplomatic mission located in India
  4. Services relating to agriculture or agricultural produce
  5. Trading of Goods
  6. Processes amounting to manufacture or processing of Goods
  7. Selling of space or timeslots for advertisements other than advertisements broadcast by radio or television
  8. Access to a road or a bridge on payment of toll charges
  9. Betting, gambling or lottery
  10. Entry to entertainment events and access to amusement facilities
  11. Transmission or distribution of electricity
  12. Specified services relating to education
  13. Services by way of renting of residential dwelling for use as residence
  14. Financial sector
  15. Services relating to transportation of passengers
  16. Services relating to transportation of goods

Definition of service – For the purpose of Service Tax applicability a service is:

  • Any activity
  • Carried out by a person for another
  • For consideration
  • And includes a declared service

Taxability of service – A service is a Taxable Service if it is

  • Provided or agreed to be provided by a person to another
  • In the taxable territory
  • And should not be specified in the negative list

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