The Hindu Business Line : Tax on 9 new services likely from June 16

THE Finance Ministry is likely to specify June 16 as the date from which service tax would be applicable on the nine new services that were brought under the tax net in this year's Budget.

Indications are also that the Budget announcement of extension of the scope of 12 existing services for the purpose of service tax may come into effect from the same date.

Although the Finance Minister, Mr P. Chidambaram, had through the Finance Bill 2005 brought nine additional services under the service tax net and extended the scope of 12 existing services, the changes were to come into effect from a date to be notified after the enactment of the Finance Bill 2005.

The Finance Bill has now been enacted into law, after the President, Mr A.P.J. Abdul Kalam, gave his assent on May 13.

Informed sources said that the Finance Ministry is all set to issue the necessary notifications soon.

Currently, service tax is levied on 71 services. The nine new services that have been brought under the tax net include transport of goods through pipeline or other conduit, site preparation and excavation, earth moving and demolition services other than those provided to agriculture, irrigation and watershed development, dredging services of rivers, ports, harbours, backwaters and estuaries.

Further, membership of club or associations, survey and map-making other than by government departments and membership of club or association, packaging services, mailing list compilation, construction of residential complexes with more than 12 dwelling units or apartments together with common areas and other appurtenances have also been brought under service tax net.

The Centre has budgeted the service tax collections for 2005-06 at Rs 17,500 crore against the revised estimate of Rs 14,150 crore for 2004-05.

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