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“Service Tax” was introduced in India in the year 1994, by Dr. Manmohan Singh, the present Prime Minister and the then Finance Minister of India.
‘Service Tax’ is the tax payable on services rendered, payable by the service providers, similar to sales tax payable on commodities sold payable by the sellers.
As the sales tax payable by the seller is transferred to the buyers of commodities/ consumers, sales tax also is transferred to the Service –users/ Service-Receivers.
From the year 1994, Service Tax had been payable only on a specified list of services, and the list had been modified periodically.
However, Mr.Pranab Mukherjee, ( the Presidential Candidate of the UPA, who recently resigned ) as the Finance Minister of India, announced in the 2012-13 Indian Budget, that Service Tax will be payable on almost all services, except the items noted in the “Negative List” of Service Tax, given in the Government of India-Ministry of Finance-(Department of Revenue)’s Notification No. 25/2012- dated at New Delhi on the 20th June 2012 on Service Tax to be published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), 2012.
The following is a brief list of the 38 items given in detail in the “Negative List” of Service Tax:-
1. Services rendered to the United Nations Organisations etc.,
2. Health care services,
3. Veterinary health care servieces,
4. Charitable activities,
5. Renting of religious places and conduct of religious ceremonies,
6. Services of Arbitrary tribunals,
7. Services by advocates,
8. Technical analysis of newly developed drugs,
9. Training / coaching in arts, culture and sports,
10. Educational Services,
11. Sports Activities,
12. Civil Engineering Services provided to the Government Bodies,
13. Temporary transfer of original copyrights,
14. Services by performing artists,
15. Services of collecting and providing news,
16. Lodging of tariff per day below Rs 1000/-,
17. Catering Services in non air-conditioned establishments,
18. Transportation by rail or a vessel from one place in India to another of selected goods,
19. Transportation of food items costing below Rs 1500/- and for transportation charges below Rs 750/-
20. Hiring of motor vehicles to carry more than 12 passengers or for goods transportation to state transport undertakings,
21. Transport of passengers, with or without accompanied belongings, by air, embarking from or terminating in an airport located in the state of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, or Tripura or at Bagdogra located in West Bengal,
22. Contract carriage for the transportation of passengers,
23. General Public Parking Services,
24. Various services provided to Government Bodies,
25. General Insurance Services related to Government Schemes,
26. Services provided by incubates,
27. Services by unincorporated bodies and registered non- profit entities,
28. Agency Services in Financial Assets,
29. Intermediate production processes in Agriculture etc.,
30. Organising business exhibitions held outside India,
31. Telephone calls from -departmentally run public telephones, public telephones operated only for local calls,and free telephone at airports and hospitals where no bills are being issued,
32. Slaughtering of bovine animals,
33. Services received from providers of services located in a non- taxable territories,
34. Services of public libraries,
35. Services by Employees’ State Insurance Corporation,
36. Transfer of going concerns, as a whole or an independent part thereof,
37. Public conveniences,
38. Services in relation to functions entrusted to a municipalities.