Corrigendum Budget
AFTER this year's Budget, it appears a record number of Corrigenda have been issued and the counting has not yet stopped. The latest Corrigendum has been issued to the Service Tax Notification No 42/2012 ST dated 29.06.2012. The Notification intended to exempt the commission paid to the overseas commission agents by the exporters of goods. The upper ceiling of the exemption was to be at a value of 10% on the FOB value of the export goods. The Notifications exempted:
from so much of the service tax leviable thereon under section 66B of the said Act, as is in excess of the service tax calculated on a value up to ten per cent of the free on board value of export goods for which the said specified service has been used, subject to the conditions specified in column (3) of the said Table, namely:-
So, the exemption was only on the value in excess of 10% of the FOB. What they wanted to exempt became chargeable and what they wanted to tax was exempted!
Therefore a Corrigendum dated 11.7.2012 has been issued omitting the words "in excess of the service tax". After giving effect to the Corrigendum, the Notification reads:
from so much of the service tax leviable thereon under section 66B of the said Act, calculated on a value up to ten per cent of the free on board value of export goods for which the said specified service has been used, subject to the conditions specified in column (3) of the said Table, namely:-