Service Tax on Discount/Incentive received., Service Tax

[Gunjan Gupta]

If one Partnership firm, is receiving incentive and disounts from various suppliers/manufacturers for acheving certain targets or eceives eraly payment Incentive or Trade discount or Rate diffrence, will the said firm is liable to Pay Service tax on such incentive/discounts under "Buisness Auxillary Services". Will the veiw will change after the applicability of Negative list method.

Posts / Replies

[Pradeep Khatri]

Please check Section 66E in this regard.

[raj kumar shukla]

If incentive received is on account of trading on principal to principal basis , no service tax would be leviable as no service is involved. if targets incentives are given on principal to agent basis , tax would be payable..

[Ashok Jogalekar]

Discount, commission or incentive received in relation sale of goods is a part of trading activity which is exempted from service tax.