Centre says State cabs not paying | india | Hindustan Times
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Centre says State cabs not paying

THE GOVERNMENT of India Revenue Secretary has written a letter to MP Chief Secretary Rakesh Sahni, complaining that the taxis hired by various State departments were not paying service tax, thereby causing loss of revenue to the Centre.

india Updated: Nov 15, 2006 18:29 IST

THE GOVERNMENT of India Revenue Secretary has written a letter to MP Chief Secretary Rakesh Sahni, complaining that the taxis hired by various State departments were not paying service tax, thereby causing loss of revenue to the Centre.

On the directives of the Revenue Secretary, the State Government has issued directions to all the government departments and public sector undertakings to ensure that such cab operators were registered with the Central Excise Department and paid service tax.

Union Revenue Secretary K M Chandrasekhar said in his letter, “It is learnt that many of the cab operators are nor registered with Central Excise Department and are not paying service tax, as required.

Considering the volume of such operations, it may involve a significant amount of service tax revenue”. Soon after getting the letter, the State’s Director Budget, Sanjay Shukla, issued directives to Principal Secretaries and Secretaries of all departments requesting them to ensure that the vehicles hired by their departments or by the public sector undertakings were duly registered with the Central Excise Department.

He said that the Ministry of Finance has brought to the notice of the State Government that taxis hired by government departments and PSUs were not paying service tax because majority of them were not registered with Central Excise Department.

What is interesting is the fact that the Union Government highlighted the issue of tax evasion. Neither the State Government nor the local office of the Central Excise Department could notice the pilferage of taxes. 

“As prescribed in the law, a taxable service provider is required to take registration, obtain 15 digits service tax code number and issue invoices/challans/bills. These documents should be serially numbered, and it should contain the name and address of service provider, service receiver, description of service, value of service and service tax payable thereon,” said Shukla letter issued to all departments.

The Director Budget also attached the copy of letter Union Revenue Secretary so that departments could understand the gravity of the situation.