The services being offered by the Insurance Regulatory and Development Authority (IRDA) will be costlier from now on, thanks to the levy of service tax.
The Authority, in its board meeting held here on Tuesday, approved the collection of applicable service tax on various services rendered with effect from January 1, 2014, Sriram Taranikanti, Executive Director, IRDA, said in a circular issued on Wednesday.
Services to be costlier With this, the transactions will become pricier for insurance companies, third-party administrators (TPAs), brokers, agents, insurance repositories, Web aggregators, referral entities and surveyors.
Accordingly, these categories of service receivers “should add service tax component to the fees while making any remittances to the Authority,” he added.
The imposition of service tax is in line with the Finance Bill 2012 which made it applicable to services provided by the IRDA in the grant of registration, licences, renewals, and so on, to the regulated entities in the insurance sector.
It may be noted that from today, Life Insurance Corporation would also collect service tax component separately from the policyholders as well; most of the private sector insurers have already been doing so.
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