Giving relief to the industry reeling under the impact of slowdown, the Government on 24/02/2009 reduced by two per cent rates of excise duty and Service Tax .
While the general excise duty has been reduced from 10 per cent to 8 per cent, the rate of service tax cut from 12 per cent to 10 per cent.
This rate cut of Service Tax was followed by the Notificaiton from Finance Ministry stating, "The Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts all the taxable services specified in sub-section 105 of section 65 of the Finance Act from so much of service tax leviable there on under section 66 of the Finance Act, as is in excess of the rate of ten per cent of the value of taxable services."
The change in Service Tax rate would be effect from the date of notification, that is, February 24, 2009.
Reference: Notification on 10 Percent Service Tax
Information Courtesy: Central Board of Excise and Customs