more-inThere may be free lunches, but it is quite clear that such lunches will not be free from tax. Recently, the tax department withdrew its demand notice to banks on free service. The Goods and Services Tax (GST) Council also issued an FAQ to clarify that certain free services provided by banks will not be subject to GST. The pre-GST regimeTaxation of free services and sale of goods were generally not an issue in the pre-GST regime. Barring the demand on free services in banking transactions, there was far greater clarity and certainty under the service tax regime and there have been limited instances of the tax department valuing free services.

Source: The Hindu September 26, 2018 18:46 UTC