From the next financial year, firms may be allowed to file service tax returns and register for paying this levy at post offices. The finance ministry and the department of posts are working out the details to implement this.
Government officials told Business Standard that the initiative could be announced either in the coming Budget or could be launched later during the year.
Officials said the new measures were likely to be introduced in metros and would be later extended to smaller towns and cities. After some years, the facility may be extended to all district headquarters.
"The move will serve several objectives like utilising the infrastructure of India Post while also making payment of service tax easier for firms," an official said.
The proposal is also in step with the finance ministry's intention to expand the coverage of service tax in the next fiscal.
Indian Post Officials said post offices would allow filing of service tax returns and assesees would be offered the facility to register for payment of the tax.
Officials also said only after the logistics were worked would the two departments begin discussions on commissions that post offices would get for offering this service.
The move to extend this in a phased manner to all towns will also depend on the success of the ongoing computerisation drive in post offices.
"A majority of the capital expenditure of the DoP is towards networking the post offices. On completion, we will have a better control of the work load and will also be able to handle additional data inputs, when service tax returns are filed," the official added.