Oh No! Eating Out at Restaurants to Become Expensive From June

Get ready to shell out a lot more as the new service tax rate of 14 per cent is coming into effect from June - making eating out at restaurants heavier on your pocket. This move will also directly impact insurance and phone bills, among other things.The service tax is currently levied at the rate 12.36 per cent including education cess. Top official sources said that the new rate of 14 per cent announced by finance minister Arun Jaitley in his Budget for 2015-16 would come into effect from June 1.What else will make you shell out more money?
Advertising, air travel, services of architects, certain type of constructions, credit cards, debit cards, cab services and event management are some of the services on which the tax will be applicable. Several other services including cable and DTH services, beauty parlour charges, courier service, dry cleaning and laundry services, asset management and insurance are also set to become expensive.What remains unaffected?In the Budget, services and products that were exempted from the tax included packaged fruits and vegetables as well as pre-cooling, ripening, retail packing and labelling of these items.What will the government achieve from it?This step would help the government earn 24.76 per cent more revenues from services at Rs 2.09 lakh crore in 2015-16 against Rs 1.68 lakh crore in the revised estimate for the current financial year. The government is also proposing to impose another two per cent Swachh Bharat cess on the services. This will be notified at a later date.Inputs from PTI