As the CBR has asked the public/private limited companies to electronically file sales tax returns, the Indian tax officials have made it mandatory for taxpayers, who have deposited Rs5 million as 'service tax', to pay the levy electronically from October 1, 2006.
Tax experts said on Friday that India has amended the Service Tax Rules, 1994 through notification No 27/2006 to expand the tax base.
Under the amendment, the rules called the Service Tax (Fourth Amendment) Rules, 2006, would come into force on October 1.
According to the new rules, "the assessee, who has paid service tax of Rs5 million or above in the preceding financial year or has paid the same amount in the current fiscal year, will deposit service tax liable to be paid by him electronically, through internet banking."
The Indian tax officials have used powers conferred by sub-sections (1) and (2) of section 94 of the Finance Act, 1994 (32 of 1994) to implement the decision, tax experts added.