Why 16th?
A very concerned netizen wrote to me,
It was proposed in the Finance Bill to extend the levy of Service Tax to certain new services. There were nine in all, each one of them proposed to be brought into the ambit of Service Tax, elementarily with a view that said services will contribute a fair amount to the Government exchequer.
The service tax on these new services was to come into force only from a date to be notified after the enactment of the Finance Bill, 2005.
Further, certain amendments were also proposed to extend the scope of certain existing services which was supposed to affect 12 services already under the net of Service Tax. The changes therein were to come into effect only from a date to be notified after the enactment of the Finance Bill, 2005.
Subsequently, the enactment of the Finance Bill , 2005 took place on the 13th May 2005. But, the relevant notifications pertaining to the new services and the notifications extending the scope of certain existing services was not issued. The same has not been done till date. It is surprising, to say the least, that the concerned authorities could not keep the machinery geared up so as to issue the said Notifications immediately after the enactment. It is now nearly a month since the enactment and if prompt action was taken to issue the said notifications immediately, all the new service providers would have started paying service tax a month or so earlier. What follows thereof is that the Government has lost a chunk of revenue by not issuing the concerned Service Tax Notifications immediately after the enactment of the Financial Bill, 2005. . Many may say, where is the ‘loss’? May be, yes – But ‘Deemed Loss’ – Definitely!!!
This gains importance in the backdrop given the Hon’ble F.M’s die hard revenue drive last year and continued follow up this year, such delay should come as a ‘paradox’.
It is now informed that the date would most probably be notified as 16th June. Is it that the concerned authorities were waiting for the ‘sixteenth day’? As history has it, enactment of changes in Finance Bill, 2001 was done on 16.07.2001 and that of Finance Bill 2002 was put to effect from 16.08.2002. Anything special about ‘16’ ? If so, why was the date not notified to be 16th of May? And I just heard some one saying ‘Accountability’?