Public Relation Services under Service Tax

By | December 9, 2013

Public Relation Services under Service Tax

Service tax has been imposed on public relation services from 01.05.2006 BY Notification No.15/2006-S.T., dtd. 24.04.2006

“Public relations” includes strategic counseling based on industry, media and perception research, corporate image management, media relations, media training, press release, press conference, financial public relations, brand support, brand launch, retail support and promotions, events and communications and crisis communications.

The definition is an inclusive definition including the following activities or services –

  • Strategic counseling based on industry (in relation to public relation management).
  • Media and perception research (normally undertaken by public relation agencies or advertising agencies but will not include market research.
  • Corporate image management exercise or campaign.
  • Media relations (developing, maintaining etc.)
  • Media training.
  • Press release (preparation, getting it published).
  • Press conference (arranging, organizing and management).
  • Financial public relations.
  • Brand support and launch (not an event management exercise).
  • Retail support and promotion (in any manner).
  • Events and communications.
  • Crises communication.

Public relation agencies are engaged to provide services relating to image or communication management.

 “Taxable service” means any service provided or to be provided to any person, by any other person, in relation to managing the public relations of such person, in any manner.

Taxable service will include not only public relation service but also any service which is in relation to public relation management. This service can be provided in any manner either directly or indirectly. The service provider also need not be a commercial concern and any person can provide such service.

For taxable services, following conditions should be satisfied –

(a) Services should be rendered by any person to other person.

(b) Service rendered should be in relation to public relations.

(c) Public relation services should be either in relation to public relation management, communication or counseling, as per definition.

(d) Taxable services can be provided in any manner.

Any person providing public relation management services shall be person liable and treated as an assessee for service tax purposes.

Value of Taxable Service:
Value of taxable service shall be the gross amount charged by the service provider of such service rendered by him.

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