New service tax for building under construction : Please put your opinion how it can affect us?

Friends,

Below is a news from one of our respected member Mr. Harjeet Singh. I am really glad with the active participation of our members. Soon, I will be sending the blog posting invitation to all the members on their email ID. This will enable all to contribute directly to the blog.

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New service tax impose by central government.most of the bilder demand for service tax.

The Central Government, vide its Notification No.1/2006-ST dated 1.3.2006, as amended by Notification No.29/2010-ST dated 22.6.2010, w.e.f. 1.7.2010 and Notification No.36/2010 dated 28^th June, 2010, has brought the “Construction of complexes” under the taxable service net under the aforesaid Service Tax Act. Accordingly all Residential, Commercial or Industrial units constructed and allotted/sold are now subject to Service Tax at appropriate rate. The rate of Service Tax applicable on various Sub-heads under which payments are to be made for the Residential Units are given at Annex-I (attached).

The aforesaid Service Tax is applicable on all payments made by you on or after 1^st July 2010. The payments received upto 30^th June, 2010 are exempt from the aforesaid Service Tax. It may please be noted that the Service Tax is linked to the actual date of payment and not linked with the date of Demand.

For all Demand raised upto 30^th June, 2010 (if not already paid before 30.6.2010), you are requested to add the Service Tax amount (as per rates specified in Annexure-I) and pay along with the Demand Amount. In case of any clarification, you may please contact the Customer Care Cell.

Annex-I

APPLICABILITY OF SERVICE TAX W.E.F. 1^ST JULY 2010

Sl.No.	Activity	Applicable Tax
01	Construction of Complex Services (All Construction Activities excluding Special Services)  (BSP)	Service Tax  Education Cess Secondary & Higher Education Cess	2.5% .05% .025%
			2.575%
02	Commercial or Industrial Construction (BSP)	Service Tax Education Cess Secondary & Higher Education Cess	2.5% .05% .025%
			2.575%
03	Special Charges (PLC, IDC, EDC, Electric Substation Charges, One time Lease Rent & Additional Basement Storage)	Service Tax Education Cess Secondary & Higher Education Cess	10% .2% .1%
			10.3%
04	Club or Association Services	Service Tax Education Cess Secondary & Higher Education Cess	10% .2% .1%
			10.3%
05	Management, Maintenance or Repair Services -          Maintenance Advance -          Maintenance Charges	Service Tax Education Cess Secondary & Higher Education Cess	10% .2% .1%
			10.3%
06	Exempt Services – Car Park
07	Other Services - IFMD		Nil