New Service Tax norm jolts tour operators

According to a recent ruling, starting January 22 2017, tour operators will have to pay a service tax on 60 per cent of the amount they bill the customer. The move might make the cost of the tours to go up by 10-15 per cent. Before this, tour operators had to pay service tax on 25 per cent of the bill amount if they offered a packaged tour, and in case of offering their service for booking a hotel as part of a tour, they paid service tax on only 10 per cent of the bill amount. For any other tour-related service, the service tax was on 40 per cent of the bill amount.