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Service Tax Voluntary Compliance Encouragement Scheme(VCES) broaden the tax base Are honest tax payers put at a disadvantage?

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Statistics Losses over Rs 9,872 crore - April- December, 2012. Recovery Over Rs 1,969 crore realised from 4,133 defaulters. Extensive publicity about the pending service tax liability Service Tax collection - Rs 132000 crore against expected 132697 crore for 2012-13. Proposed Service Tax Collection for the current fiscal Rs180141crore

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Extract of Budget Speech Registered Assesses17 Lakh Return Filers 7Lakh The FM Proposed VCES to Collect A Reasonable sum of Money From The Defaulters. Immunity from Interest, Penalty & Prosecution

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Constitutional Validity The presidential assent was received on 10 th May 2013. Thereafter The CBEC, vide notification no. 10/2013 ST dated 13 May 2013, notified the Service Tax Voluntary Compliance Encouragement Rules, 2013 The VCE Scheme was brought into effect upon enactment of the Finance Bill, 2013.

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What is VCES? An Amnesty Scheme To Broaden the Tax Base To give incentive to defaulting persons to voluntarily Pay tax dues To know the Probable Defaulters Period Involved 1/10/2007 to 31/12/2012

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Few Salient Features Of VCES For Tax Dues from January 2013 onwards-Benefits Of VCES Cannot Be Availed If Declared once- Payment Is Must as Per Proposed Section 100 of The Finance Act, 2013 No Refunds

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How and when the liabilities have to be paid?

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What are the Immunities Available? Waiver Of Interest Waiver Of Penalty Free From Any Prosecution

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Reason behind the Amnesty Golden Chance For those who wants to Make Good their Wrong Done For 10 lakh Probable Defaulters To Introduce a Tax Generation Instrument Large scale non-compliance

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Who Is Eligible to get Immune? Stop-filers of returns; Non-filers of returns; Non-registrants; Service providers who have not disclosed true liability in the returns filed during the period of scheme Who Is Not Eligible? Assessees disclosing true liability in service tax returns Assessees in receipt of Show Cause Notice / Order of Determination u/s 72, 73 or 73A of Finance Act, 1994 Assessees being audited under the provisions of Finance Act, 1994 and such audit is pending as on 1 March 2013 Assessees against whom inquiry / investigation has been initiated and is pending as on 1 March 2013:

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Procedure For Availing Amnesty Submit Declaration in Form VCES-1 with Designated Authority a Half Yearly Calculation Sheet is also to be submitted a separate calculation sheet for each category of service. The calculation sheets are to be in the format of the service tax return After submission of form VCES 1, the Designated Authority shall issue an acknowledgement in form VCES 2 within seven working days. The acknowledgement does not certify the correctness of the declaration furnished by the assesse. proof of payment periodically along with copy of acknowledgement (Form VCES 2) is also to be furnished Upon furnishing of the same in full, the Designated Authority will issue an Acknowledgement of Discharge in form VCES 3 within seven working days To make a Declaration, First You needs to Get registered with the dpartment.

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Inherent Flaws Undertaking given by Mr. P.Chidambaram To The Honble Supreme court Cumbersome Procedure of availing the befits of the Scheme. Unawareness among the semi urban & rural areas about Service Tax Laws.

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Broadening of Countrys Tax Base The Amnesty Scheme is a welcome move by the Finance Ministry to increase the tax base and, thereby, increasing service tax collections. The expected collection from the scheme is Rs. 35000 Crore

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Conclusion YES NO Are Honest Tax Payers at A Disadvantage?

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Bibliography www.Indiabudget.nic.in www.Servicetax.gov.in www.Google.com Websites of Various Reputed CA Firms Various Blogs Authenticate Blogs I would Like to add Few Names Who helped me in making This Presentation: CA Yogita Anand Maam CA Pankaj Jain Isha Chitkara & Tanvi Jain

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Elocutionist: Govind Rai Garg Reg. No. : NRO0302415