A - Rate of Service Tax: The Rate of Service tax increased from 10% to 12% effective from 01 st April 2012, this was by way of exemption notification no. 08/2009 dated In line with the above increase the tax rate slabs of Service tax on Money Changing Transactions, Life Insurance Distributing or Selling agent of lotteries also increased. Similarly Service Tax on Composition scheme for Works Contract Services is also increased from 4% to 4.8%

B – Negative List of Services To be effective from the date to be notified subsequently It is proposed to do away with various defined list of Services so that all the services will become taxable except 17 heads of services given under Negative list under Section 66D Declared Services: Certain services like renting of immovable property, construction of complex etc., which per se are not covered within the definition of services are specifically defined to be deemed services under Section 66E

Effective after enactment of Finance Bill 2012 a)Due to negative list of Services, The service specific Exemption notification No.1/2006, will be superseded with 12/2012. b)New section 72A is being inserted to introduce provisions relating to special audit by Cost Accountants and Chartered Accountants in the service tax law on the lines of section 14A and section 14AA of the Central Excise Act, c)Time Limit to issue Show Cause Notice increased from 12 Months to 18 Months.

e)Filing of appeal before the Commission (Appeal) has been made at par with Excise. f)Valuation for Works Contract Services changed. g)Amount received as Demurrage or by any other nomenclature in relation to provision of service would become part of value of taxable service. h)Services such as, Hire of Motor Vehicle for transport of passengers, Manpower Supply and Works Contract will be partially brought under reverse charge mechanism vide Notif. No. 15/2012-ST dated on enactment of Finance Act.

j)Single Coding mechanism for Payment of Excise and Service Tax to be introduced. k)New form of EST-1 for filling Excise and Service Tax return to be introduced after inviting feedback. Individual and Partnership firms are required to file returns on Quarterly basis and others whose service tax payment is more than 25 lacs pa is required to file return on Monthly basis.

Service Tax Rules 1994 (Effective from ) a)The time limit for issue of invoice under Rule 4A increased from 14 days to 30 days. However in case of new levy, the invoice should be raised within 14 days of the payment if advance is received prior to new levy. b)Restriction of Rs. 2 Lacs for adjustment of service tax have been removed. Thus any amount of adjustment is permissible under Rule 6(4A). Also the requirement of intimation to department about such adjustment is also dispensed with. c)In case of Exporters the period extended by the RBI on specific request is also being included in the period for which the tax liability is allowed to be deferred, normally it is six months. d)For individuals and partnership firms having turnover upto Rs. 50 Lacs need to discharge service tax on actual receipt of money and not on raising of the invoices in addition to the eight specified services.

Point of Taxation Rules, 2011 ( Effective from ) :- a)The Continuous Supply of Service definition has been changed to attract repetitive nature of services and the obligation for payment periodically or from time to time. b)Rule 6 for Continuous Supply of Service is deleted and effect given under Rule 3 itself and accordingly Rule 4 and 5 covering change in effective rate of tax and taxation of new services, shall now be applicable to continuous supply of services also; c)All Annual Contracts are to be treated as Continuous Supply of Service only for the purpose of POT rules; d)Date of Payment defined as the date on which the payment is entered in books of accounts or credited into bank account of the person liable for service tax whichever is earliest. e)New Rule introduced for POT, where point of taxation is not ascertainable the same will be determined by applying Best Judgment principle by the Central Excise Officials.

CENVAT Credit Rules, 2004 (Effective from ) a)Rule 5 for refund of unutilised Cenvat Credit has been substituted the new provision provides refund of total Cenvat credit in proportionate Export Turnover to Total Turnover of. b)Refund of Input Service Tax credit available to all Categories as against restricted Categories of services. c)Cenvat Credit on Motor Vehicles & component Spares thereof, other than those falling under Chapter 8702, 8703, 8704, & 8711 (these being used for conveyance of passengers) has been allowed. d)Service Provider allowed to take credit of inputs & capital goods even if the goods are delivered at a place other than registered premises subject to documentary evidences. e)Service Provider allowed to remove the capital goods as waste and scrap.

CENVAT Credit Rules, 2004 (Effective from ) f)Input Service Credit shall be distributed on the basis of basis of the turnover of the respective unit. If any service is exclusively pertains to only one unit then it should not be distributed to that unit only. g)Transfer of Cenvat Credit of Special Additional Duty allowed from one unit to another unit of the same manufacturer or service provider having a common income tax permanent account number. h)Rule 14 amended with Cenvat Credit taken “and” utilised wrongly, which was up till now Cenvat Credit taken “or” utilised wrongly by this govt. corrected rules prospectively, the the effect of Supreme court judgment in case of Ind swift laboratories. i)Sub-rule 6A has been amended with retrospective effect from so as settle the dispute relating to reversal of Cenvat credit for taxable services rendered to SEZ units.