Service Tax on Tour operator service in connection with Haj & Umrah pilgrimage
Is Service Tax leviable on tour operator service in connection with Haj & Umrah Pilgrimage? The amount charged to the pilgrims in India undertaking Haj and Umrah pilgrimage, is for services provided by the Government of Saudi Arabia and the tour takes place outside India.
CBEC has clarified that as per Rule 3 (1) (ii) of the Export of Services Rules, 2005, (and Circular No. 111/05/2009 – ST dated 24.02.2009), the service in respect of tour operator is export if such service is performed outside India. It is also provided therein that where such taxable service is partly performed outside India, it shall be treated as performed outside India.
Therefore, it is clarified that service tax is not chargeable on the services provided in respect of tour undertaken for carrying out Haj and Umrah Pilgrimage in Saudi Arabia by Indian pilgrims considering these as export of service, provided they fulfill the other conditions of export as provided in Export of Service Rules.
What is the difference between Haj and Umrah ?
The Prophet is believed to have said, “ Alternate between Hajj and `Umrah because both rid one of poverty and sins just as the blacksmith's bellows remove all impurities from metals like iron, gold and silver. The reward for Hajj mabrur is nothing short of Paradise"
Haj | Umrah |
|---|---|
Hajj is the fifth pillar of Islam, and it is mandatory for everyone who is physically and financially able to perform it once in a lifetime | Umrah is not a pillar of Islam and it is only recommended and not obligatory. |
Hajj must be performed in the prescribed time period, namely the months of Hajj, and even more specifically, the major rites are done in the first two weeks of Dhul- Hijjah. | Umrah, however, can be done any time of the year. |
Hajj involves staying in Mina, performing the rite of wuquf (standing) in the plains of `Arafat, staying in Muzdalifah, and pelting the stone pillars, as well as sacrifice in some cases. | Umrah involves only the rites of Tawaf and Sa`i with ihram |
Haj, Umrah or maybe tour operator for any occasion abroad is not taxable in India.