Indian Service Tax
Cable Operator
Effective Date: 16/08/2002
Authority: Notification No. 8!2002-ST, dt. 1/8/2002 (for full text of Notification see under'Beauty Parlour').
Rate of Service Tax: 8% from 14-5-2003 (5% upto 13-5-2003) 10% from 10.9.2004 - Cess 2% of 10% = 0.2. Total ST = 10.2%.
Definitions
"cable operator"has the meaning assigned to it in clause (aa) of Section 2 of the Cable Television Networks (Regulation) Act, 1995 (7 of 1995), [Section 65(21 )].
"cable service"has the meaning assigned to it in clause (b) of Section 2 of the Cable Television Networks (Regulation) Act, 1995 (7 of 1995), [Section 65(22)].
Taxable service: Cable operator providing cable service to subscribers through a cable television network.
Value of taxable service: Gross amount charged from subscribers.
Exemptions
(a) See Chapter on "General Exemptions"
(b) Specific exemptions
-
Entertainment tax if clearly shown
-
Broadcasting services
-
Cost of cable and installation charges
Person liable to pay: Cable operator
Head of Account
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Changes from 10-9-2004
F.No. B2/8/2004-TRU, Date:10-9-2004
17. Extension of service tax on cable operators to Multi System Operators (MSOs)
In cable TV services, broadcast channels transmit television signals to multi system operators (MSO) who further send them to the cable operator The services Provided by the MSOs to the cable operators have been made taxable.
Main text of Departmental Circular/TN
F. No. Bl1/1/2002-TRU, Date: 1-8-2002
l. The section referred to hereinafter are the sections or clauses of the Finance Act, 1994 as amended by the Finance Act, 2002. Reference to subclause or clause means clause or sub-clause of Section 65 of the Finance Act, 1994 as amended by the Finance Act, 2002.
2. As per clause (20), "cable service" shall have the meaning assigned to it in clause (b) of Section 2 of the Cable Television Networks (Regulation) Act, 1995. As per clause (19) "cable operator" shall have the meaning assigned to it in clause (a) of Section 2 of the Cable Television Networks (Regulation) Act, 1995. The taxable service, as per sub-clause (zs) of clause (90) is any service provided to a customer, by a cable operator in relation to cable services.
3. As per the Cable Television Network (Regulation) Act, 1995, the definitions of cable service and cable operator are as follows:
"cable operator" means any person who provides, cable service through a cable television network or otherwise controls or is responsible for the management and operation of a cable television network;
"cable service" means the transmission by cables of programmes including re-transmission by cables of any broadcast television signals;
4. The taxable service in this case is the cable services provided by the cable operators. The programme broadcast by television channel are received either by Multi System Operators (MSO) or directly by cable operators in the form of signals., Where MSO receives the signals, they first retransmit signals to the cable operator who in turn retransmits the same to the viewers through the cable network provided by the cable operator. Service tax is liable to be paid by the cable operator providing service to ultimate subscriber of cable services.
5. In some States, cable operators are also liable to pay entertainment tax. In such cases, a cable operator charges from his customer an amount inclusive of entertainment tax. A point has been raised as to whether the amount paid as entertainment tax is liable to be included in the value of taxable service. It is clarified that the entertainment tax collected and paid to the Government will not be includible in the value of taxable service, provided the cable operator clearly indicates the entertainment tax element in his bill to the customer.
Notifications
Prior to 10/9/2004
[Notification No. 25/2004-ST, dated 10-9-2004]
For full text see under "Banking & Other Financial Services".
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