New Delhi: In bid to meet the Swachh Bharat campaign, Railway fares for travel in the upper class categories will go up by 4.35% from Sun day as passengers have to pay the newly-levied Swachh Bharat cess of 0.5% in service tax.
According to a rail ministry circular, fares will go up by 4.35% for First Class and all AC Classes.
Service tax and Swachh Bharat cess are chargeable on 30% total passenger fare. However, the service tax will not be applicable for tickets issued before 15th of November. The Ministry said the levy will not be applicable for general and sleeper class travel.
The government had proposed to levy Swachh Bharat cess at the rate of 0.50% on all services with effect from Sunday, which are presently liable to Service Tax.
According to an estimate, the service tax levy and the Swachh Bharat cess are expected to fetch about 1,000 crore rupees in a year. Annual earnings for railways from the passenger segment are estimated to be at about 35,000 crore rupees.