Soon after the Bihar assembly polls, the Narendra Modi government has announced a 0.5% Swachh Bharat cess applicable on all services presently liable to service tax, with effect from November 15. With this, the effective service tax rate would be 14.5%.
The finance ministry stated in New
Delhi that this levy will translate into a tax of 50 paisa on every Rs
100-worth of taxable services, the proceeds of which will be exclusively used
for Swachh Bharat initiatives.
“The Swachh Bharat cess is not
another tax but a step towards involving each and every citizen in making
contribution to Swachh Bharat,” the ministry stated.
The provision for a cleanliness cess
on all or any of the services was announced in Budget 2015-16. The ministry
stated that by spending on cleanliness, many diseases could be prevented and
the associated healthcare expenditure could be saved.
Swachh Bharat is among the major
initiatives of the Modi government, which has embarked on a major drive to
ensure cleanliness across the country.
In his Budget speech on February 28,
finance Minister Arun Jaitley had
said: “This cess will be effective from a date to be notified. Resources
generated from this cess will be utilised for financing and promoting
initiatives towards Swachh Bharat”.
The government had in Budget 2015-16
estimated to collect over Rs 2.09 lakh crore from service tax. The R400-crore
collection from the cess would be over and above that.
Health push
* The Narendra Modi government has
announced a 0.5% Swachh Bharat cess applicable on all services presently liable
to service tax, with effect from November 15
* The finance ministry stated this
levy will translate into a tax of 50 paisa on every Rs 100-worth of taxable
services, the proceeds of which will be exclusively used for Swachh Bharat
initiatives.
Source : financialexpress.com
