APPLICABILITY OF KKC ON DEBTORS AS ON 31.05.2016 – OUR ANALYSIS

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Dear Readers,

New cess called Krishi Kalyan Cess (KKC) has been introduced at the rate of 0.50% on the value of all taxable services with effect from 1st June 2016. This is in addition to service tax leviable on services and recently introduced Swatch Bharat Cess. Thus, from 1st June onwards effective rate of service tax will be 15% (14%+0.50%+0.50%) making various host of services dearer by 0.50%.

There is huge debate going on right now about the levy of Krishi Kalyan Cess (“KKC”) on the closing balance of debtors as on 31.05.2016. Please Download The file to see our detailed analysis on the same. In our opinion, KKC shall not be applicable on the value of debtors as on 31.05.2016. To avoid the confusion, we hope that a suitable clarification is issued considering the reasons expressed by us in the attached document. Please feel free to give us your valuable feedback.

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Regards

CA GROUPS

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20 FAQs On Krishi Kalyan Cess – A New Levy