Arun Jaitley may increase service tax from 15% as precursor to GST rollout
Advertisement
It is likely that Finance Minister Arun Jaitley will increase the service tax from 15% to at least 16% in the run up to Goods and Services Tax (GST) rollout.
During Budget 2017, Jaitley is expected to close gap with 18% GST rate as most of the services are likely to attract a tax of 18% under GST.
GST rollout is expected to happen on July 1 as stalemate over dual control continued in the GST Council meeting.
So, the government may slap a higher service tax for three months to somewhat offset the revenue loss after the GST kicks in.
As per industry experts, a service tax closer to the GST rate will give time to consumers to adjust to the new rate.
Service tax accounts for over 14% of Indian government’s total tax revenues. In 2016-17, Rs 231,000 crore service tax accounted for total tax revenues of Rs 16,30,887 crore.
The GST Council has agreed on a four-slab structure –5, 12, 18 and 28 percent—along with a cess on luxury and sin products such as tobacco.
Advertisement
During Budget 2017, Jaitley is expected to close gap with 18% GST rate as most of the services are likely to attract a tax of 18% under GST.
So, the government may slap a higher service tax for three months to somewhat offset the revenue loss after the GST kicks in.
As per industry experts, a service tax closer to the GST rate will give time to consumers to adjust to the new rate.
Advertisement
The GST Council has agreed on a four-slab structure –5, 12, 18 and 28 percent—along with a cess on luxury and sin products such as tobacco.
Advertisement
- I quit McKinsey after 1.5 years. I was making over $200k but my mental health was shattered.
- Some Tesla factory workers realized they were laid off when security scanned their badges and sent them back on shuttles, sources say
- I tutor the children of some of Dubai's richest people. One of them paid me $3,000 to do his homework.
- Top 10 Must-visit places in Kashmir in 2024
- The Psychology of Impulse Buying
- Indo-Gangetic Plains, home to half the Indian population, to soon become hotspot of extreme climate events: study
- 7 Vegetables you shouldn’t peel before eating to get the most nutrients
- Gut check: 10 High-fiber foods to add to your diet to support digestive balance