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Service tax on in-bound roaming fee from Jan. 15

Special Correspondent

`Service to in-bound roamers delivered, consumed in India'

CHENNAI: The Department of Revenue (Union Ministry of Finance) has clarified to its field formations that domestic telecom operators providing roaming service to international in-bound roamers are liable to pay service tax on the amount received through the home network of the visitor on account of service provided to such international roaming subscribers.

Service tax on the basis of this circular in respect of such services should be collected with effect from January 15, the department said.

The circular pointed out that service to in-bound roamers is delivered and consumed in India, and, therefore, it is not an export of service (not liable to service tax). "International practice treats the telephone service provided to an in-bound roamer by the visited network, for purposes of taxation, in the same manner as a telephone service provided to any home subscriber,'' the department said.

It also pointed out that though the visitor is not directly billed by the visited network or provided with a telephone instrument, the visitor is nonetheless provided with telephone service, for which roaming fees are collected from the home network of the visitor, "traditionally on a per minute basis and typically determined by the service provider's pricing plan.''

For the period prior to January 15, the matter is under examination of the board.

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