The most awaited advancement in the Service Tax regime viz, change in rate of Service Tax is being brought to effect from today i.e. 1st June, 2015. The change was initiated by the Central Government vide Notification No. 14/2015-ST dated 19th May, 2015.
Following shall be the fate of transactions in transit which have not been completed in entirety prior to change in rate. The following table specifies the rate of Service Tax to be applicable on transactions according to Rule 4 of Point of Taxation Rules,:
| Sl. No. | Date of Completion of Service | Issue of Invoice Date | Receipt of Payment Date | Effective Rate of Service Tax |
| 1 | Before 01.06.2015 | On or after 01.06.2015 | On or after 01.06.2015 | 14% |
| 2 | Before 01.06.2015 | On or after 01.06.2015 | 12.36% | |
| 3 | On or after 01.06.2015 | Before 01.06.2015 | 12.36% (to the extent advance received) | |
| 4 | On or after 01.06.2015 | Before 01.06.2015 | On or after 01.06.2015 | 14% |
| 5 | Before 01.06.2015 | Before 01.06.2015 | 12.36% | |
| 6 | On or after 01.06.2015 | Before 01.06.2015 | 14% |
Further, in case of reverse charge, rate would be decided according to Rule 7 of Point of taxation Rules 2011, under which, there may be two cases which are as follows:-
- If payment is made after 1-06-2015, New Rate would applicable.
- If payment is not made within 3 months and due date arise on or after 1-06 2015, then New Rate would be applicable.
