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Service tax

1. Four services brought under service tax net namely, asset management service provided under ULIP, services provided by stock/commodity exchanges and clearing houses; right to use goods, in cases where VAT is not payable; and customized software, to bring it on par with packaged software and other IT services.
2. Threshold limit of exemption for small service providers increased from Rs.8 lakhs per year to Rs.10 lakh per year; about 65,000 small service providers go out of the tax net.

CST and a Roadmap towards GST

1. Central Sales Tax rate being reduced from 3 per cent to 2 per cent from April 1, 2008.
2. Roadmap for Goods and Service Tax being prepared for introduction of GST from April 1, 2010.

Source: Relyon | Back to Budget Page