FAQ's - service tax

1. 1. What is Service Tax?
Service Tax is a tax imposed by Government of India on services provided in India. The
service provider collects the tax and pays the same to the government. For example, if you
are selling a product at Rs. 1000/- and Flipkart Marketplace fee is Rs. 100/-, the service tax is
calculated on the marketplace fee of Rs. 100/-.
2. Is there a change in the service tax?
Yes, the service tax has been increased to 14% from the previous 12.36% in the Union
Budget 2015.
3. Will the changed service tax be applicable on all products?
Yes, the increased service tax of 14% will be applicable on Flipkart Marketplace fee from
June 1st, 2015.
4. Say, if a replacement for an order that was placed before the new service tax came into
effect, which service tax will be applicable on the order - the old one or the new one?
In this case, we will charge the new service tax rate for the replacement order.
5. What will happen to return orders?
The marketplace commission rate reversal/charges for all such orders will be applicable as per
the old rate.