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Nature of Service
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Present Provision
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Proposed Provision
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Analysis/Remark
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Transport of goods by rail
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Abatement of 70% without any CENVAT credit.
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Abatement of 60% for transport of goods by rail by any person other than Indian railways.
Abatement of 70% for transport of goods by rail other than as stated above.
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Presently no CENVAT was available, however as a manner of rationalization CENVAT credit of service tax paid on input services will now be allowed. Further, difference in abatement rates seems to meet the vision of Indianisation.
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Transport of passengers by rail
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Abatement of 70% without any CENVAT credit.
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Abatement of 70% with CENVAT credit of tax paid on input services.
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CENVAT credit is allowed to avoid cascading effect.
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Services of GTA in relation to transport of goods by road
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Abatement of 70% without any CENVAT credit.
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Abatement of 70% on services of goods transport agency in relation to transport of goods other than used household goods without CENVAT credit.
Abatement of 60% on services of goods transport agency in relation to transportation of used household goods without CENVAT credit.
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It seemed that government is finding more revenue in reselling of household goods considering the popularity of quickr and olx.
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Service provided by a foreman of chit fund in relation to chit fund
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Omitted resulting into no abatement and full CENVAT credit.
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Abatement of 30% without CENVAT credit.
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Transport of passengers with or without belongings
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Transport of passengers, with or without accompanied belongings, by
(a) a contract carriage other than motorcab. (b) a radio taxi.
No CENVAT credit was admissible.
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Transport of passengers, with or without accompanied belongings, by
(a) a contract carriage other than motorcab. (b) a radio taxi.
(c) a stage carriage.
No CENVAT credit was admissible.
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This amendment will come into effect from 01-06-2016.
Simultaneous change is introduced in negative list. However, such services by a non-air-conditioned stage carriage will continue be exempted.
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Transport of goods by vessel
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Abatement of 70% without any CENVAt credit
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Abatement of 70% with CENVAT credit on input services.
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Rationalization to avoid double taxation.
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Services by a tour operator
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Presently three kinds of abatement rates were available for –
(a) arranging or booking accommodation (Abatement of 90%)
(b) packaged tour (Abatement of 75%)
(c) any other service other than above two (Abatement of 60%)
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Now there are two categories –
(a) arranging or booking accommodation (Abatement of 90%)
(b) any other related service (Abatement of 70%)
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This is rationalized and conditions remained same as earlier. However, the concept of packaged tour is now no more in existence.
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Construction of complex, building, civil structure or a part thereof.
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There are two provisions of abatement-
(a) abatement of 75% in case of a residential unit having carpet area of less than 2000 sq feet and costing less than ₹ 1 crore
(b) abatement of 70% in other cases.
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Now uniform abatement of 70% is proposed.
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The other conditions remained same as earlier.
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Renting of motor cab services
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Abatement of 60%.
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Abatement of 60%.
A new explanation is introduced.
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The cost of fuel should be included in the consideration charged for providing renting of motor-cab services for availing of the abatement.
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