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Currently Input of Swachh Bharat Cess not available 

Also input of Krishi Kalyan Cess can be utilized against Krishi Kalyan cess

Example 1

Service  Received

AIRTEL  
Telephone Bill 4000
Add  
Service Tax @ 14% 560
Swachh Bharat Cess @ 0.5% 20
Krishi Kalyan Cess @ 0.5% 20
Total 4600

Service Provided

Service to X Ltd  
Consultancy Service 10000
Add  
Service Tax @ 14% 1400
Swachh Bharat Cess @ 0.5% 50
Krishi Kalyan Cess @ 0.5% 50
Total 11500

Make Service Tax Computation

Partoculars Service Tax Swachh Bharat Cess Krishi Kalyan Cess Total
Output Service Tax 1400 50 50 1500
Input Service Tax 560 0 20 580
Service Tax Payable 840 50 30 920

After implementation of GST,all these cess will be abolished
There will be Central GST and State GST in this case also

AIRTEL
TELEPHONE 2000
CENTRAL GST 12.5% 250
STATE GST 5% 100
Total 100
Service to X Ltd  
Consultancy Service 10000
CENTRAL GST 12.5% 1250
STATE GST 5% 500
Total 11750
PARTICULARS CENTRAL GST STATE GST TOTAL GST
OUTPUT GST 1250 500 1750
LESS      
INPUT GST 250 100 350
GST PAYABLE 1000 400 1400

 

Remarks
No Input of Swachh Bharat Cess currently obviously created confusion and complexity which has been thankfully avoided in GST
However,Government should ensure that Total Rate of State GST+ Central GST should be ideally equal to current rate of Service tax i.e. 15%
Otherwise more tax will be payable by customer

 

  1. GST - Goods and Services Tax, India
  2. GST Impact
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About the Author

CA Maninder Singh's photo - Expert in Practical Accounts, Taxation and Efiling
CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 7 years. He provides courses for Practical Accounts, Taxation and Efiling at teachoo.com .
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