Mumbai: The government has issued a notification providing for refund of service tax paid by exporters on four taxable services, which are not in the nature of ''input services,'' but could be linked to export goods.

These are:
(i) Port services provided for export. (section 65[105][zn] of the Finance Act, 1994)

(ii) Other port services provide for export. (section 65[105][zzl])

(iii) Services of transport of goods by road from ICD to port of export provided by goods transport agency. (section 65[105][zzp])

(iv) Services of transport of export goods in containers by rail from ICD to port of export. (section 65[105][zzzp])

Services tax paid by exporters on input services used for export goods is refunded under the existing schemes. Drawback schemes also factored service tax paid on input services used for export goods, according to a release issued by the central board of customs and excise (CBCE).

The issue of extending refund of service tax paid on taxable services, which are not "input service" but could be attributable to export goods was examined. Unlike goods, services are intangible in nature. Hence, post audit verification to establish linkage of use of service with export requires a simple and verifiable method. Government held discussion with the stake-holders and identified the above mentioned taxable services for which refund could be provided wherever use of the said taxable services could be linked to exports.

The release said the government held discussion with the stake-holders and identified these taxable services for which refunds could be provided wherever use of the taxable services could be linked to export.

The government collects 12 per cent service tax along with three per cent education cess on services.

Exporters already get refund of service tax paid by them on input services used for exports. Drawback scheme also factors service tax paid on input services used for exporting goods.

In July, the finance ministry had provided a financial package of Rs1,400 crore to exporters, especially to the textile, handloom, handicraft and other labour-intensive industries, to cushion the impact of rupee appreciation. The domestic currency has appreciated by over eight per cent since January this year.

The details are available in the notification on the CBEC website www.cbec.gov.in.
also see : General reports on Economy
General reports on Economy