Clarification on Swachh Bharat Cess (SBC)

As per notification number
21/2015-ST, read with Section 119 of the Finance Act, 2015 and notification
number 22/2015-ST, Swachh Bharat Cess (SBC) will come into effect from
15th November 2015
, at the rate of 0.5% on all services except services
covered under Negative List and services exempt from payment of tax.

Introduction of this new levy has
raised doubts in industry regarding its applicability and allied matters. Team
DYN has made an attempt to clarify these doubts in form of FAQ in its DYKS-427.
Now, Central Government has issued
Notification No. 23/2012-ST, 24/2012-ST and 25/2012-ST to remove uncertainties.
Relevant Notification
Whether SBC would be chargeable on
Gross amount charged or on net taxable value in case of abated service?
SBC would be chargeable on net
taxable value.
Whether provisions of reverse
charge mentioned under notification number 30/2012-ST would also be
applicable in case of SBC?
Yes, all the provisions of reverse
charge mentioned under notification number 30/2012-ST would also be
applicable on SBC.
What would be Swachh Bharat Cess
on services where service tax is being paid under the alternative rates of
service tax as per provision given under Rule 6 (7), (7A), (7B) or (7C) of
Service Tax Rules, 1994?
The person liable for paying the
service tax under sub-rule (7), (7A), (7B) or (7C) of rule 6, shall have the
option to pay SBC as per following method:
(Total service tax liability of
relevant calendar month/quarter calculated under sub-rule (7), (7A), (7B) or
(7C) of rule)*0.5/14
Note: Service provider can also
pay SBC as per normal provisions, however, if once SBC paid by exercising
special provisions mentioned above then it shall apply uniformly in respect
of such services and shall not be changed during a financial year under any
In addition, CBEC has also issued
FAQ on SBC, to download CLICK HERE
In FAQ CBEC, interalia, clarified
that for payment of SBC separate accounting code would be notified shortly in
consultation with the Principal Chief Controller of Accounts. These codes are
as follows:
Swachh Bharat Cess (Minor Head)
Tax Collection
Other Receipts
Deduct Refunds
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