Parliament on Thursday approved a Bill to amend the Constitution and enable the Centre to levy a tax on service providers. The Bill will allow both the Centre and the states to collect and appropriate the tax.
The Constitution (95th Amendment) Bill, approved by the Lok Sabha on May 5, was passed by the Rajya Sabha on Thursday.
The AIADMK opposed the legislation, demanding the service tax should be brought under the Concurrent List. The Shiv Sena wanted the bio-technology, health and education sectors to be exempted from the tax.
Winding up the discussion on the Bill, Finance Minister Jaswant Singh described the AIADMK's criticism as 'misplaced' and said the service tax had been brought under the Union List to ensure uniformity and an equal sharing of revenue.
The Bill was an enabling provision, Jaswant said. He added that a separate service tax bill would be brought before Parliament.
Jaswant assured wide-ranging consultations would be held before taking up the measure. He assured Shiv Sena members that certain services would be exempted from the tax and small time service providers like plumbers, electricians and carpenters would be kept out of its purview.
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