Applicability of Swachh Bharat Cess (SB Cess):
The concept of SB Cess has been originated from the Union Budget, 2015, where the provision has been made for levying a SB Cess on all or any of the Services but this cess was to be levied only from the date as notified by the Central Government.
Now, on 06th November, 2015, Central Government has notified that SB Cess @ 0.50% will be applicable from 15th November, 2015 over and above the present 14% of Service Tax rate. Therefore, the new rate of Service Tax including SB Cess will be 14.50% from 15th November, 2015 on all taxable services.
What type of Services will be covered under SB Cess?
The SB Cess will be applicable on value of all taxable services except the following:
- Negative list of services under section 66D of The Finance Act, 1994
- Services exempted by the Central Government through any notification
Important to note:
The following clarifications are still pending with regard to SB Cess:
- Treatment in accounting of SB Cess charged and paid
- Will the CENVAT credit of this Cess be allowed?
- Will the SB Cess is applicable on those ongoing transactions which have been initiated before 15th November and advance has also been accepted against those services but the services will be completed only after 15th November, 2015?
- It’s not clear whether this Cess will be considered for calculation on full value or abated value?
