Government likely to withdraw tax notice on free banking services

Every bank offers a different slab of minimum balance to customers, based on which 'free services' are provided

The tax department will likely withdraw a show-cause notice issued to several banks asking them to pay the service tax on ‘free services’ provided to customers, following the finance ministry’s intervention.

The department of financial services (DFS) has presented the views of the banks that have opposed the tax to the revenue department. “We have spoken to the revenue department and requested them not to pursue the case. The matter will be settled and the case might not be pursued further,” said a senior finance ministry official.

Some of the Directorate General of Goods and Services Tax Intelligence (DGGSTI) offices