Why Service Tax ?
Extract of my letter being sent to the PM .
"To begin with I am taking the issue of Service Tax, which I personally find very irritating burden particularly on the middle class. As a retired person, dependent on pension, but leading a active life and also engaged in socially useful pursuits, I find that levy of Service Tax on large number of services that people have to avail, one has to shell out Service Tax. I find this a big irritant and financial burden, and for which I do not see any logic or rationale. Of course I am not a economist to research the roots, origin or logic of Service Tax; but each time I visit a restaurant, a small luxury that I can afford, its pleasure is halved when in the bill I find the addition of VAT, Service Tax and quite often the Service Charge. I can understand VAT and Service Charge, but am totally at loss on the imposition of Service Tax.
Most of the services are provided in India by the private sector which are individual enterprises in management of which the Central or the State Governments have no role; hence no logic for Service Tax. If we go into the brief history of Service Tax, it was initiated two decades ago in 1994 and to begin with it covered only four services. Gradually over the years the number of services brought under it has increased from 4 in the beginning to 119 by the year 2012. Almost every year, new services have been brought under it. This in a way shows greed of the successive governments to mobilise as much service tax as possible by expanding the number of services under it.
Today it is surprising to observe that even services like Dry-cleaning, Internet Café, Fax, Outdoor Caterer, Mandap Keeper, Photography, Pandal Shamiana etc have been covered under Service Tax which greatly affect the lower middle class families, , job seekers etc. in a big way for availing these and other such services.
I feel that there is a need to have relook at all taxes, and particularly the Service Tax. May I request you to kindly arrange a thorough review of the service tax in terms of its logic & rationale, reasons for expanding the coverage of more services almost on a regular basis, the tax amounts mobilised, administrative expenditure and avenues on which the surplus is deployed. If the surplus, net of administrative expenditure, is deployed on any populist schemes, there is more of a reason to withdraw it or rationalise it in a big way.
I hope my request will receive due consideration at appropriate level." more
"To begin with I am taking the issue of Service Tax, which I personally find very irritating burden particularly on the middle class. As a retired person, dependent on pension, but leading a active life and also engaged in socially useful pursuits, I find that levy of Service Tax on large number of services that people have to avail, one has to shell out Service Tax. I find this a big irritant and financial burden, and for which I do not see any logic or rationale. Of course I am not a economist to research the roots, origin or logic of Service Tax; but each time I visit a restaurant, a small luxury that I can afford, its pleasure is halved when in the bill I find the addition of VAT, Service Tax and quite often the Service Charge. I can understand VAT and Service Charge, but am totally at loss on the imposition of Service Tax.
Most of the services are provided in India by the private sector which are individual enterprises in management of which the Central or the State Governments have no role; hence no logic for Service Tax. If we go into the brief history of Service Tax, it was initiated two decades ago in 1994 and to begin with it covered only four services. Gradually over the years the number of services brought under it has increased from 4 in the beginning to 119 by the year 2012. Almost every year, new services have been brought under it. This in a way shows greed of the successive governments to mobilise as much service tax as possible by expanding the number of services under it.
Today it is surprising to observe that even services like Dry-cleaning, Internet Café, Fax, Outdoor Caterer, Mandap Keeper, Photography, Pandal Shamiana etc have been covered under Service Tax which greatly affect the lower middle class families, , job seekers etc. in a big way for availing these and other such services.
I feel that there is a need to have relook at all taxes, and particularly the Service Tax. May I request you to kindly arrange a thorough review of the service tax in terms of its logic & rationale, reasons for expanding the coverage of more services almost on a regular basis, the tax amounts mobilised, administrative expenditure and avenues on which the surplus is deployed. If the surplus, net of administrative expenditure, is deployed on any populist schemes, there is more of a reason to withdraw it or rationalise it in a big way.
I hope my request will receive due consideration at appropriate level." more
Viewed by 26
service tax is nothing but loot. The revenue collected is either not spent judiciously and efficiently or black money is generated by floating tenders at higher rates and collecting commissions. Thus artificial shortage of revenue is created and new taxes are created in various nomenclatures. There is no purpose in levying new taxes & no relation to its spending either. more
Jun 12
Service is basically comes in picture when its has been observed that many people who did not file their returns and not paying Income Tax and enjoying life. The Income Tax slab must be reduce to 10% so that people will file correct return. Service person like us at liable to TDS etc.. and even we are paying equally the Service and sate taxes too. Of course the service must categorized according to services not a flat like VAT and Income Tax come down to 10% maximum. more
Jun 12
Service Tax is a most illogical tax levied by Govt. Not only it is a burden on the people, but it is also meaningless, because Govt is collecting Service Tax without actually giving any service. Restaurants, Lodges, Educational Institutions etc., etc., collect Service Tax and remit it to the Govt. I am at a loss to understand as to what sort of service Govt. is giving to the people in these areas and how the Govt. is entitled to levy or earn Service Tax for the services not rendered by it. It is a debatable subject and needs review. Crores Rupees are unnecessary spent and wasted by Govt. at several levels. If that can be detected and saved, the people can be saved from burdening this kind of meaningless taxes. more
Jun 12
