Change in rate of Service tax for hiring of motor vehicle on non-abated value

Service Tax  notification no:10/2014 dated 11^th July, 2014,   changes  the percentage of  service tax to be paid under reverse charge mechanism with respect to services provided or agreed to be provided by way of renting of a motor vehicle designed to carry passengers on non- abated

value to any person not engaged in similar line of business from existing 40% to 50% (  change in serial number 7 (b) columns 3 and 4 of notification no:30/2012 dated   20^th June, 2012.) with effect from 01.10.2014.

Thus in order to deposit service tax on 40% value under reverse charge mechanism on renting of motor vehicle all the invoices dated/issued on or after 1^st October, 2014 should bear the following words:

“Abated Invoice, Service tax to be paid by service receipted on abated value i.e. 40% of invoice value” and signed by the service provider, issuing the said invoice.