Service tax raised to 14 per cent applicable from today

Get ready to pay more from today onwards as service tax raise upto 14 per cent which means you have to pay more on travelling, mobile bills, eating out, marriages.

Earlier the service tax was levied at the rate of 12.36 percent.

Finance Minister Arun Jaitley proposed to rise the service tax from 12.36 per cent to 14 per cent.This proposal will take effect from 1 June. 

The service tax will be levied on most of the services.

Some of the services on which service tax is applied and hence will they become costlier are airways, railways, credit cards, mobile bills,  banking, event management, advertising.

In Railways, 0.5 per cent of hike of service tax will be brought under the effect from today onwards in the AC and First  Class fare. Earlier 3.7  per cent of service tax was levied on train fares for First Class and the AC Class but from today onwards, it will go upto 4.0 per cent.

Mobile operators and credit card companies are already sending message to their customers informing them about the increase of service tax rate.

The government has proposed to raise the service tax to facilitates the smooth transition to the Goods and Service Tax(GST) system.

Finance Minister Arun Jaitley in his budget speech said," to facilitate the smooth transition to levy of tax on service by both Center and the States. It is proposed to increase of the service tax plus education cesses from 12.36 per cent to 14 per cent"