Refund procedures for service tax simplified

  Railways has decided to exempt service tax on tickets issued before October 1, 2012. The ministry decision is to avoid complexities in collecting the tax on board. The service tax, on AC and first classes will be levied only on tickets issued after October 1.

The railways in its decision day before had stated that service tax would be levied on fare of passenger services from October 1 and announced that it would be recovered either by TTEs in the train or by the booking offices before commencement of the journey.  Now, this would not be done. The Railway Ministry has sent a circular to zonal railways in this regard.
The railways has also decided to make procedures easy for refunding of service tax in case of cancellation of tickets. Now, the railway will refund it directly from its counters. However, service tax on the amount of cancellation charges will be charged.

According to procedures announced on Thursday, the railways was not to refund the amount collected on a ticket as service tax. It was to be collected by the passengers from the service tax authority, after getting a certificate from railways signed by its two officers.
However, in case of cancellation of tickets booked by the passengers on or after October 1, 2012, service tax will be refunded by railways after deducting a portion of service tax on the amount of cancellation charges. 

No separate service tax will be charged for food and refreshment.  
Services like parking, space or time slots for advertisements, public conveniences, (bathrooms, washrooms, lavatories, urinal or toilets), and hotels, inns and guest houses have been exempted.

“There was some confusion on parking lots as finance ministry wanted it to be charged on the ground that it is leased. We have clarified that we have no leased such spaces and only licensed it. So, no service tax will be charged on parking,” clarified an official.