Service tax on AC and first class rail fares from October

Service tax will be added on high-end passenger classes, freight and auxiliary services rendered at railway stations from 1 October 2012. Railway Ministry was under Trinamool Congress and Trinamool was against rise of fare and freight. The decision was taken on 26 September at a meeting between new Railway Minister C.P. Joshi and Finance Minister P. Chidambaram. This is considered as a first move of new Union Railway Minister to revive the financial condition of Indian Railways. Fares of air-conditioned classes will go up by 3.708 per cent and that of first class by 7 per cent. Freight charges will be increased also by 3.708 per cent. Passengers enjoying auxiliary services at stations will have to pay 12.36 per cent more as compared to previous charge.