Negative list of services – No Service tax on these services – Section 66D

Meaning and Importance      

Negative list of services were introduced in the year 2012, when the levy of service tax took a paradigm change. Negative list of services means the list of services on which there is no service tax. If you are providing any of the services mentioned in the negative list then you can provide the service even without Service tax registration.

In other words, if your services fall under the negative list, then Service tax is not at all applicable to you.

Negative list of Services

The negative list shall comprise of the following services, namely:—

• services by Government or a local authority excluding the following services to the extent they are not covered elsewhere—

1. services by the Department of Posts by way of speed post, express parcel post, life insurance, and agency services provided to a person other than Government;
2. services in relation to an aircraft or a vessel, inside or outside the precincts of a port or an airport;
3. transport of goods or passengers; or
4. any  service ,  other  than  services  covered  under  clauses  (i)  to  (iii)above, provided to business entities;
    

• services by the Reserve Bank of India;
   
• services by a foreign diplomatic mission located in India;
   
• services relating to agriculture or agricultural produce by way of—
  1. agricultural  operations  directly  related  to  production  of  any  agricultural  produce including cultivation, harvesting, threshing, plant protection or testing;
  2. supply of farm labour;
  3. processes carried out at an agricultural farm including tending, pruning, cutting, harvesting, drying, cleaning, trimming, sun drying, fumigating, curing, sorting, grading, cooling or bulk packaging and such like operations which do not alter the essential characteristics of agricultural produce but make it only marketable for the primary market;
  4. renting  or  leasing  of  agro  machinery  or  vacant  land  with  or  without  a  structure incidental to its use;
  5. loading, unloading, packing, storage or warehousing of agricultural produce;
  6. agricultural extension services;
  7. services by any Agricultural Produce Marketing Committee or Board or services provided by a commission agent for sale or purchase of agricultural produce;
      
• trading of goods;
   
• services by way of carrying out any process amounting to manufacture or production of goods excluding alcoholic liquor for human consumption;
   
• selling of space for advertisements in print media;
   
• service by way of access to a road or a bridge on payment of toll charges;
   
• betting, gambling or lottery;
  
  [Explanation—For  the  purposes  of  this  clause,  the  expression  "betting,  gambling  or
  lottery" shall not include the activity specified in Explanation 2 to clause (44) of section 65B;]
   
• transmission or distribution of electricity by an electricity transmission or distribution utility;
   
• services by way of—
  1. pre­school education and education up to higher secondary school or equivalent;
  2. education as a part of a curriculum for obtaining a qualification recognised by any law for the time being in force;
  3. education as a part of an approved vocational education course;
      
• services by way of renting of residential dwelling for use as residence;
   
• services by way of—

1. extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount;
2. inter se sale or purchase of foreign currency amongst banks or authorised dealers of foreign exchange or amongst banks and such dealers;
    

• service of transportation of passengers, with or without accompanied belongings, by—

1. a stage carriage;
2. railways in a class other than—
   • first class; or
   • an airconditioned coach;
3. metro, monorail or tramway;
4. inland waterways;
5. public transport, other than predominantly for tourism purpose, in a vessel between places located in India; and
6. metered cabs or auto rickshaws
    

• services by way of transportation of goods—

1. by road except the services of—
   • a goods transportation agency; or
   • a courier agency;
2. by an aircraft or a vessel from a place outside India up to the customs station of clearance in India; or
3. by inland waterways;

• funeral, burial, crematorium or mortuary services including transportation of the deceased.

Conclusion

Negative list of services are of prime importance. If you have any doubt regarding whether your service falls under this category or not, then you should consult our team before forming any opinion.

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