New Services from Tomorrow – But where are Board Instructions?
THE following new services are to come into effect from tomorrow.
1. Transport of goods by rail
2. Cosmetic surgery or plastic surgery
3. Transport of coastal goods; goods through national waterway; goods through inland water.
4. Advice, consultancy or assistance in any branch of law
But strangely, the Board is deafeningly silent – there is no circular, there is no notification, there is no instruction.
What will be the value of taxable services? Will there be any abatement? What will be the Small scale exemption limit for this financial year?
For Legal Consultants, appearance before Courts and Authorities is not treated as taxable service. How are they going to find out what the fee is for consultancy and what it is for appearance?
Suppose I collect a fee for appearance but I don't appear as the Court does not sit – I still collect a fee, but I have not provided any service, nor appeared. Is the fee taxable?
The whole idea of making the provisions applicable from a date after the enactment of the Finance Bill is to help the prospective assessees to understand the tax and for the Board to put its system in place.
The Bill was enacted on 19 th August – today are we in any way better than we were on 19th August 2009? Government could have as well made the law effective from 19.8.2009 – they could have got a little more Revenue.
It is understood that the Railways are not ready to collect the tax and nobody knows at what point the tax is to be collected and there certainly has to be an abatement.
Let us hope at least today the Board will come up with the necessary notifications and instructions.
In his reply to the Finance Bill, the Finance Minister said,
“Addition of new services to the list of taxable services or alterations in the scope of existing taxable services made through Finance Acts come into force from a notified date after the enactment of the Finance Bills; Trade and industry has requested that sufficient time be provided between notifying such changes and making them effective, thereby enabling adjustments in business accounting systems and software. I find merit in this suggestion. Accordingly, I have directed the Central Board of Excise and Customs to make the notifications prescribing levy of service tax on new services and alterations in the scope of existing services announced in the current Budget effective from the 1st day of September 2009.”