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Q. > Please Help: service tax on air travel sub agent
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1442 views • Question added Jun 06, 2013 • Service Tax • By Saurabh Nagpal , CA , Sonipat


In light of the negative list based approach of service tax, what is the tax liability of a sub-agent of travel agent in terms of air ticketing, package tour re-sale, etc. For instance, if I am purchasing a package tour from Thomas Cook and selling it to my customer, acting as a sales agent of Thomas Cook, and earning commission / margin, on it, what is the service tax liability. Similarly, what happens in the case of purchase of ticket from IATA agent and re-sale to my client by adding profit (markup) and earning commission from the IATA agent. Do I pay service tax only on the commission+markup added ? If so, does the commission/markup need to be shown explicitly on the bill ? The customer will know my profit by looking at the service tax imposed thereof which would be bad.

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