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Service tax: King Khan tops

Shah Rukh has paid Rs 71 lakh as service tax for April to June '06, writes Manish Pachouly.

india Updated: Aug 16, 2006 03:38 IST

Bollywood badshah Shah Rukh Khan has to pay a price for endorsing products — a whopping Rs 71 lakh. This is the amount King Khan forked out as service tax for April to June 2006.

While other actors too strut their stuff for the advertising industry, Khan rules the roost when it comes to paying service tax. He is followed by Abhishek Bachchan who paid Rs 25 lakh this financial year (2006-07). Rani Mukherjee is at the third slot with Rs 18 lakh and Amitabh Bachchan, Rs 15 lakh.

Other major service taxpayers include Sushmita Sen (Rs 9 lakh), Hrithik Roshan (Rs 8 lakh), Saif Ali Khan (Rs 7.5 lakh) and Ajay Devgan (Rs 6.75 lakh).

Service tax is paid quarterly while the return for the same is filed every six months.

Confirming the figures, SJ Singh Commissioner, Service Tax, said the department had identified 70 brand ambassadors who had to pay service tax and half of these had not even registered themselves with the department.

"Notices have been sent to 35 brand ambassadors who are either from the film or television world," Singh said.

Levying of service tax on brand ambassadors was a controversial issue till recently. Actors had argued that they worked in individual capacity and not as commercial concerns and don't fall under the ambit of service tax.

However, in the latest Union budget, the government clarified that individual endorsing of products would come under service tax net. The government removed the words "commercial concern" from all the areas falling under the service tax bracket and replaced it with "person".

This cleared the confusion. Service tax officers said, post this amendment a lot of celebrities from Bollywood and television who have endorsed products, came forward to register themselves with the department.

Meanwhile, service tax officers have also written letters to the Brihanmumbai Municipal Corporation (BMC), BEST and railways asking them to register themselves with the department as they sell space for advertisement and provide other services. Singh confirmed that letters were written to these government bodies.

The department wanted information about the persons these bodies had given services to and the payment they got for the same.

Singh added that the department has only sent letters to these bodies but it would meet general managers of all these bodies some time soon.