In depth revenue analysis of selected taxable services to augment revenue -reg. - Service Tax - F.No. 137/72/2007-CX.4

In depth revenue analysis of selected taxable services to augment revenue -reg. F.No. 137/72/2007-CX.4 Government of India Ministry of Finance Department of Revenue (Central Board of Excise Customs) Dated : January 4, 2008 Subject : In depth revenue analysis of selected taxable services to augment revenue -reg. The service tax revenue analysis shows that the revenue collection is marginally above the pro-rata BE so far. It also reflects that all India basis some of the taxable services having major revenue potential are either showing a negative growth or showing a growth rate much less than the expected. This office has attempted to list out such taxable services that have substantial revenue potential which are showing negative/marginal growth and have limited number of taxpayers. These services are, - (i) Telecom Services (ii) Stock Brokers Services/Commodity exchange (iii) General Insurance Services (iv) Insurance Auxiliary Services (v) Air Travel Agent Services (vi) Tour operator Services (vii) Broadcasting Services (viii) Transport of goods by Air Services (ix) Transport of goods through pipe lines (x) Port Services (xi) Banking and other financial Services (xii) TV/Radio programme production Services. These services/sectors need to be analaysed in depth to ascertain the reasons for low growth. The idea is that with limited resources, if efforts could be concentrated in finding out the reasons for such inadequate growth in respect of these services and adequate steps could be taken to augment revenue during the last quarter of the current Financial Year, it may lead to better overall revenue performance. 2. It is however, possible that the pattern may be little different in your zone/commissionerate. In such a case the top ten (revenue-wise) services showing negative/inadequate growth can be selected. The service providers of such services should be subjected to intensive audit (if not done already) including special audits (if felt necessary) to verify the correctness of Cenvat Credit availment. The past 4 returns (i.e. April, 06, Oct - 06, April, 07 and Oct, 2007) of such service provider should be taken up for intensive scrutiny. The taxpayers (preferably through association) should be contacted and the reasons for low growth as well as the projected revenue during the last quarter should be ascertained. Further, in certain cases (like stock brokers, telecom, general insurance etc.) the information about the turnover of the service providers are available with third party sources, such as regulatory authorities, stock exchanges, Income tax department etc. Attempt should be made to obtain such third party data and compare the same with return data. Further published/printed information in respect of service provider providing these services may also be collected and compared with the information furnished in the service tax return. 3. The growth in revenue from the selected services is being monitored at the level of Secretary (Revenue). It is therefore requested that action taken reports on the efforts made and result therefore may be sent to DGST on 1.2.08 and 1.3.08, GST may collect the reports received from zones/commissionerate and forwarded Member (Service Tax) by 7th of the respective months. 4. This issue with the approval of Chairman (CBEC).