What is a service tax and who pays this tax?

[samkapoor77]

What is a service tax and who pays this tax?

[samkapoor77]

Service tax is a central tax levied upon selective services provided like stock broking, insurance, courier etc. It is a tax imposed on the transaction of certain services which are specified by the Union government under the Finance act of 1994. The service tax is a type of an indirect tax (similar to Excise duty or the sales tax). It usually means that the service provider pays the tax and then recovers the amount paid from the recipient of taxable service.

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