Finance Act, 2012 have introduced the concept of Negative List of Service Tax. All services are liable for Service Tax except the those specified in Service Tax Negative list. That is, in the negative list of services system the services that are mentioned in the negative list are exempted and all other services are taxable. Earlier, the services that are specifically mentioned in the act are charged to tax, and all other services were exempted from service tax. So, now this concept of the negative list is the other way. First Notification regarding this was issued on 20-06-2012. After that number of notifications has been issued to amend the Negative List. Here we have updated the latest Negative list of Service Tax 2016-17.
Negative List of Service Tax – Section 66D
Negative List (Section 65B(34)): Negative List means the services which are mentioned in Section 66D of service tax.
The updated Negative List of Service Tax is listed below. The service tax negative list shall comprise of the following services.
- Renting of immovable property:
- Agriculture or agriculture produce by way of renting of vacant land.
- Renting of a residential dwelling.
- Renting of property by RBI.
- Renting of property by Govt or local authority to Non-business entity.
- Financial Services:
- Services by RBI.
- Services by way of giving deposits, loans, advances in so far as a consideration is represented by way of interest or discount.
- Inter sale or purchase of foreign currency among Banks/ authorized dealers.
- Educational Services:
- Services by way of pre-school education and education up to higher secondary school.
- Education for obtaining a qualification recognized by any law.
- Services provided by or to Govt / Local Authority: Services provided by Central Govt, State Govt or local authority are in the Negative list but the following are taxable.
- Services provided by a department of the post by way of speed post, express parcel post, life insurance & agency services provided to a person other than govt.
- Services in relation to vessel or aircraft inside or outside of a port or airport.
- Transportation of goods or passengers.
- Support Services.
- Services relating to agriculture / agriculture procedure: Services relating to agriculture / agricultural produce by way of
- Agricultural operations, i.e., cultivation, harvesting, plant protection or testing.
- Supply of farm labor.
- The process carried out at an agricultural farm.
- Renting or leasing of agro machinery or vacant land.
- Loading, Unloading, Packing, storage, warehousing of agricultural produce.
- Agricultural extension services.
- Job work process: Process amounting to manufacture or production of goods, i.e., process on which excise duty leviable under central excise act 1944.
- Services of transportation of goods by road: Services by way of transportation of goods by road except the services of Goods Transportation Agency (GTA) or courier agency.
- Transportation of goods by other modes of transportation:
- Services by way of transportation of goods by vessel or an aircraft from a place outside India up to customs station of clearance in India.
- Services by way of transportation of goods by inland waterways.
- Transportation of Passengers: Service of transportation of passengers by
- Stage carriage
- Railways in a class other than 1st class or A.C. coach
- Metro, Monorail or tramway
- Inland waterways
- Public transport other than for tourism purpose in a vessel between places located in India.
- Radio taxies, metered cabs or Auto, rikshaws.
- Sale of space / time slot for advertisement: Selling of space or time slot for advertisement other than by Radio / TV.
- Trading of Goods: Trading of goods is covered under Negative list.
- Admission to entertainment events or access to amusement facilities: Admission to entertainment events or access to amusement facilities are covered under Negative list.
- Services by access to road or bridge on payment of toll charges: Services by way of access to road or bridge on payment of toll charges are covered under Negative list.
- Betting, Gambling or Lottery: Betting, Gambling or lottery are covered under Negative List
- Transmission or distribution of electricity by an electricity transmission or distribution facility: Transmission or distribution of electricity by an electricity transmission or distribution facility are covered under Negative list.
- Funeral burial, mortuary services: Funeral burial, mortuary services including transportation of the deceased are covered under Negative list.
For more information regarding the Negative list of Service Tax, please refer the file attached below.