Citizens' Issues
Eating ice cream at an ice cream parlour is a ‘service’ and may be taxed!

It is apparent that the government is trying to fill its pockets through all means possible so that it can continue to indulge in wasteful expenditure. Its philosophy seems to be tax till you get the axe!

The government is thinking of making eating of ice cream at service parlours subject to service tax! Why? Because ice cream parlours are air-conditioned and hence subject to service tax! The question is whether ice cream is a product or a service! To my mind, ice cream is a manufactured product and is subject to excise duty once it leaves the factory. Because it is a product, it will be subject to value added tax (VAT) as per the respective state laws. Now an additional dose of tax—service tax @12.36% over and above the two taxes is being proposed. This will lead to taxation in excess of 35% on ice cream that would be eaten at an ice-cream parlour… it just makes me want to scream.
 

The basics of product vis-à-vis service is being brought into question by fuddy-duddy bureaucrats who want to be in the good books of the finance ministry by whatever means possible and the citizenry at large be damned, I guess.
 

It is apparent that a useless government is trying to fill its pockets through all means possible to enhance its coffers so that it can continue to indulge in wasteful expenditure. The more money they take through direct and indirect taxes, the more would be available for siphoning off through the various ongoing scams.
 

This is going to kill the food industry completely. People have stopped going to beer bars and restaurants due to the high incidence of taxation. Now, they will stop going to ice-cream parlours, which are basically teenage and family evening-out hot spots! The government is telling people buy your stuff, take it home and eat. DO NOT EAT OUT. It is becoming a complete killjoy of a government. Its philosophy seems to be tax till you get the axe! Looks like the voters need to sharpen their axes!

User

COMMENTS

Yogesh

4 years ago

This will be ridiculus. Then why not segragate the bill of ice cream into ingradients amount and then service amount required for prepartion of ice cream. Same way in restorants also, bill should have two colomns first ingradient cost and second cost which gone for preparation of items. Then govt will be able to charge the service tax only on 2nd colomn.

SuchindranathAiyerS

4 years ago

The government's fiscal and (extra) legal policies will tax the economy out of existence in tandem with monetary policy unless Public Sector and Government pay rolls are slashed by 50 to 60% and performance accountability on pain of removal from employment is brought in. Forthwith.

ashwin bahl

4 years ago

Panic button has been pressed and thus half baked ill thought and ill conceived ways to collect more revenue!

Giieve Palkhivala

4 years ago

soon breathing will be taxed

jaykayess

4 years ago

This is pathetic, and is a direct result of Chidambaram's philosophy. His penny-pinching ways and sheer arrogance is causing the bureaucracy to behave in this anti-national, illogical, immoral, illegal manner. (And I agree with O P Sharma's earlier comment - remember that Chidambaram is an advocate!)

I can just imagine the next step... delivery of a product is a service, and will attract service tax over and above the product related taxes already paid!

For this particular case of ice cream parlours, somebody needs to challenge it. What if I walk into a parlour and buy an ice cream cone but take it out with me and consume it elsewhere?

Shadi Katyal

4 years ago

This kind of tax power and even thinking shows that how far GOI will go to collect revenue as she has failed to bring any investments in the industry.
India is one of the biggest taxed nation as British devised to collect revenue as far AAM AADMI is concerned. I presume next will be tax on going out of house as it does ear and tear even the worst kept roads. We do pay road tax on cars etc but foot traffic is next.

there is no question that Billions had been given away on subsidies of petrol,diesel,kerosene and gas in the past and now with empty treasury new methods to tax.
India must take a special place when it comes to genius thinking of taxing . What a way to run a nation. Taxation without any thinking

Om Prakash Sharma

4 years ago

And Advocates don't have to pay any service even though they are giving service to their client. Why> Because most of the politicians are advocates

ADB lowers India’s growth rate to 5.8% in 2013

The growth rate is expected to accelerate in 2014 as slower inflation provides some scope for monetary easing that could boost investment and consumption, ADB said in its ‘Asian Development Outlook Supplement’

Slow progress of economic reforms is expected to pull down India’s growth to 5.8% in 2013 from 6% projected earlier, an Asian Development Bank (ADB) report said on Tuesday.

 

“In India, slow progress in pushing through the reforms needed to ease business bottlenecks means growth is likely to be 5.8% this year, slower than the previously forecast 6%,” the report ‘Asian Development Outlook Supplement’ said.

 

Meanwhile, finance minister P Chidambaram in Jaipur said on Tuesday that India was likely to clock over 6% growth in the financial year 2013-14, in the backdrop of government taking host of steps to boost sagging economy.

 

India’s growth fell to a decade’s low of 5% in fiscal 2012-13.

 

ADB in April had projected a growth rate of 6% for India in 2013.

 

It further said the projected growth at 5.8% in 2013 will be “higher than the 5% posted in 2012, growth remains constrained by supply-side bottlenecks, as reflected in the continued slowdown in fixed capital formation, weakness in the industrial sector, and sluggish progress in pushing through badly needed structural reforms.”

 

The growth rate, it added, is expected to accelerate in 2014 as slower inflation provides some scope for monetary easing that could boost investment and consumption.

 

“Growth will be further boosted by pre-election spending, and the pickup in US growth will support Indian tech companies and related service sectors”, ADB said, adding, the US was likely to grow at 2% in 2013 and 2.6% in 2014.

 

Elsewhere in South Asia, it said, Sri Lanka will continue to grow strongly, while other parts of the region will see softer-than-anticipated growth.

 

South Asia, it said, is expected to grow by 5.6% in 2013 and 6.2% in the following year.

 

As regards China, ADB said, the country was likely to see 7.7% growth this year and 7.5% in 2014 after growth of 7.8% in 2012.

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RBI announces fresh steps to tackle rupee volatility

Under the measures announced, RBI raised lending rates to commercial banks by 2% to 10.25% making the loans costlier

In a move to stem the continuing fall of rupee, the Reserve Bank of India (RBI) late Monday came out with a clutch of measures including hiking the lending rates for banks and sucking up of Rs12,000 crore, to make the currency dearer.

 

The measures came after high level meetings between the prime minister and the finance minister followed by discussions with RBI governor D Subbarao who was called to Delhi as the rupee lost 33 paise to reach 59.89 per dollar after touching over 61-levels last week.

 

Under the measures announced, RBI raised lending rates to commercial banks by 2% to 10.25% making the loans costlier.

 

The RBI will conduct sale of Government of India Securities to suck up Rs12,000 crore on 18th July from the market, in a move to make rupee dearer.

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