A key aspect of SST expansion is the imposition of 8% service tax on rental of commercial properties. This affects the operating cost of businesses across all sectors.

TRATAX Executive Director Thenesh Kannaa explains at AwaniNiaga about the circumstances in which service tax is applicable on rental of commercial properties, the go-live date for imposition of tax (1st July vs 1st Sept) and the registration threshold.

Thenesh explains the some of the exemptions available particularly in relation existing tenancy agreements for which the exemption up to 30th June 2026 is available only if the agreement meets the criteria to qualify as a non-reviewable contract and is duly stamped by 9th June 2025. He also explains on the exemption for MSME tenants and the need to carefully assess whether all exemption criteria are met.