Service Tax: The Latest Update

Abstract

There are ever so many ramifications of the law regarding service tax which we need to take into account in our practical daily life. Since it is an evolving law, it should be watched with interest. IT was Dr.Manmohan Singh who introduced Service Tax into the Indian fiscal system when he became Finance Minister in 1991. Our GDP is made up of incomes of individuals and corporate houses, the value of goods manufactured by our industries and the services rendered in the Economy. It was realized early in the 1990's that services accounted for more than 50% of our GDP. It started off with a modest levy of 5% on a limited number of services. Gradually, the net was spread wide and the rate was increased. At present, the rate is 12% on the value of services. The contribution of service tax to Central Revenues exceeded Rs.1,80,000 crores in the Budget 2013-14.