Budget could make air travel, eating out dearer
NEW DELHI: Union finance minister Arun Jaitley could raise the service tax rate in the Budget to be presented on February 1, a move that will increase the cost of eating out, going to the movies or flying.
Two senior gover nment sources told Hindustan Times on Friday that the existing rate of 15%, which includes two cesses, could be raised by another 0.5% to 1%.
“The government might want to increase the service tax so that theshiftto GSTisnotabrupt,” one of them said, referring to a proposed a Goods and Services Tax that has missed several deadlines because of political wrangling. Jaitley has said he wants to roll it out by July 1.
Service tax is a charge service providers collect from customers and then pass on to the Central government.