The revenue department today clarified that the proposed levy of service tax on Automated Teller Machines would not have any impact on holders of credit cards, debit cards, charge cards and other payment cards who use them for withdrawal of cash.
Service tax, under the proposed service, is not leviable for use of ATM by card holders. Service tax on the proposed taxable service is leviable only if the services provided are in relation to operations, maintenance or management of ATMs and are outsourced by banks to third parties, it said.
The department said third parties which provide services to banks in relation to ATM operation, maintenance or management are covered under the category of the proposed service.
When ATMs are operated, maintained or managed by banks on their own, service tax liability does not arise, an official release said.Do you want to discuss stock tips? Do you know a hot one? Join the Stock Market Investments Discussion Group