Effective rate of service tax on package tour operator has been reduced "
Notification no. 38/2007 ST dated 23/8/2007 has been issued to amend notification no. 1/2006 ST dated ST 1/3/2006 to reduce the effective rate of service tax on package tour operator service.
Effective Rate of Service Tax on Package Tour shall be 25% of full rate of Service Tax i.e. 3.09% of the gross value. A comparison chart shows the new rate and old rate
|
S. No. |
Sub- clause of clause (105) of Section 65 |
Description of taxable service |
Conditions |
New Rate |
Old Rate |
|
(1) |
(2) |
(3) |
(4) |
(5) |
|
|
2 |
(n) |
(i) Services provided or to be provided to any person, by a tour operator in relation to a package tour.
Explanation.- The expression "package tour" means a tour wherein transportation, accommodation for stay, food, tourist guide, entry to monuments and other similar services in relation to tour are provided by the tour operator as part of the package tour to the person undertaking the tour. |
The bill issued for this purpose indicates that it is inclusive of charges for such a tour |
25 |
40 |
|
(ii) Services provided or to be provided to any person, by a tour operator in relation to a tour, if the tour operator is providing services solely of arranging or booking accommodation for any person in relation to a tour. |
(a) The invoice, bill or challan issued indicates that it is towards charges for such accommodation, and
(b) this exemption shall not apply in such cases where the invoice, bill or challan issued by the tour operator, in relation to a tour, only includes the service charges for arranging or booking accommodation for any person and does not include the cost of such accommodation. |
10 |
10 |
|
(iii) Services, other than services specified in (i) and (ii) above, provided or to be provided to any person, by a tour operator in relation to a tour |
The bill issued indicates that the amount charged in the bill is the gross amount charged for such a tour. |
40 |
40 |
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