The education cess on service tax will continue to be imposed even after the switchover to the negative list system.The Joint Secretary (Tax Research Unit) of the Central Board of Excise and Customs, Mr V.K. Garg, in a letter to all Chief Commissioners of Excise and Customs, clarified that a new notification and new order, issued on Friday, will validate the continuation of education cess on Service Tax.“Any board circular that is contrary to the revised law will stand automatically superseded,” he added.But exporters will have no problem in getting exemption from service tax on payments to commission agents abroad. At the same time many new services such as train travel by air conditioned class will attract service tax from July 1.The Government has introduced the concept of negative list which will replace the system of positive list, which was in operation since 1994.
Source: The Hindu Business Line
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