Service tax exemption for digitalised customers...

New Delhi December 8 : Finance Minister Arun Jaitley proposed a concept, which will exempt credit and debit card transactions up to Rs. 2,000 from the levy of service tax.

This Proposal is aimed at promoting electronic transactions following the demonetization of high value currency notes from the midnight of November 8.

Mr. Jaitley on Wednesday admitted that there was a cash shortage in the country, while experts have predicted it would take months for enough cash to be printed to replace the currency that was drained of the system due to the demonetization announcement.

The proposal modifies the 2012 notification that delineated the services exempt from tax. These include services provided by arbitral tribunals, the testing of newly developed drugs, educational institutions, trade unions, general insurance businesses sports bodies, and services provided by international bodies such as the United Nations, among others.

Meanwhile, the Reserve Bank of India on Thursday made it optional for users to go through a two-factor authentication for online payments of up to Rs 2,000. It is very useful to customers, which are using digital transactions.