The Government expects to mop up more resources from the service tax, according to Mr P.C. Jha, Chairman of Central Board of Excise and Customs. The service sector adds more than 50 per cent of GDP while in terms of tax-GDP ratio, the share of the service tax is a meagre 1.1 per cent.
The service tax in India was launched in 1994 and in 1994-95, the tax rate was five per cent and three services were taxed and the Government raised Rs 410 crore on this score. In the past 14 years, the number of services being taxed has increased to 106 and the Government earnings from the service tax many times more and the rate of tax too has been jacked up to 12.36 per cent. In 2007-08, over Rs 51,000 crore was increased by way of service tax and the aim for the current year has been set at more than Rs 64,000 crore. Judging from the trend so far in the current year.
The service tax in India was launched in 1994 and in 1994-95, the tax rate was five per cent and three services were taxed and the Government raised Rs 410 crore on this score. In the past 14 years, the number of services being taxed has increased to 106 and the Government earnings from the service tax many times more and the rate of tax too has been jacked up to 12.36 per cent. In 2007-08, over Rs 51,000 crore was increased by way of service tax and the aim for the current year has been set at more than Rs 64,000 crore. Judging from the trend so far in the current year.
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