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Monday, Mar 18, 2002

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Service tax

With the service sector growing rapidly, it is no wonder that the Government is bringing various services under the tax net to feed its increasing appetite for revenue. Even small services in the unorganised sector, such as catering, dry cleaning, cable TV operators, etc, are being taxed. But strangely, lawyers have still been kept out of this net.

The public may recall that when it was proposed to bring the lawyers under the tax net a few years ago, it resulted in a flood of litigation. This is perhaps why the Government does not seem interested in taxing them. This creates a bad precedent and must be avoided at all cost. The Government must not be cowed down by legal action. It would be quite appropriate if the Bar Council of India recommends that the Government levy service tax on services rendered by lawyers.

L. V. Srinivasan

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