ICAI paper on service tax on realty
By IANSThursday, April 22, 2010
GANDHINAGAR - The Institute of Chartered Accountants of India (ICAI) has submitted to the finance ministry a concept paper proposing a simpler method of calcuting service tax on commercial or industrial constructions.
Finance Minister Pranab Mukherjee in the budget has proposed imposition of service tax on construction of commercial and industrial property.
The finance bill sought to amend the meaning of taxable service in relation to commercial or industrial constructions to provide that unless the entire consideration for the property is paid after the receipt of completion certificate from the competent authority, the activity of construction would be deemed to be a taxable service provided by the builder/developer to the prospective buyer and the service tax would be charged accordingly.
ICAI president Amarjit Chopra said Thursday that this has been a matter of concern for the real estate and construction industry as well as buyers of properties.
“ICAI has submitted the concept paper which aims to provide some workable methods to the government for effective implementation of the provisions relating to levy of service tax on this sector as also a simpler and easier method for computing the service tax liability for the assessee,” said Chopra.
