Changes proposed in Service Tax by Union Budget 2016-17 Rate of Service Tax The effective rate of Service tax has been increased from 14.50% to 15% (14% ST+ 0.5 Swachh Bharat Cess + 0.5% Krishi Kalyan Cess) by way of introducing Krishi Kalyan Cess @ 0.5% (w.e.f. 01-06-2016) on value of taxable services. Input credit of Krishi Kalyan Cess shall be allowed to be used for payment of the Krishi Kalyan Cess only. CHANGES IN NEGATIVE LIST (Section 66D) (effective from date of enactment of Finance Act 2016) Educational Services: Presently, clause (I) of section 66D of the Act covers specified educational services. These services are proposed to be omitted from the Negative List. However the service tax
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