Cost of living in city set to soar

Rajmeet Singh
Tribune News Service
Chandigarh, February 28
Already among the expensive cities to live in, the average cost of living in the City Beautiful has gone up with the Modi government announcing an increase in the service tax from 12.36 per cent to 14 per cent.
Largely affecting the middle class consumers in the city, the increase of 1.64 per cent in the service tax has not gone down well with them as it has literally affected their day-to-day living.
They will now end up paying more for mobile bills, cable TV, restaurant bills, repair of consumer gadgets, tuition classes of their children, movies at theatres and any other services that attract service tax.
“It is not just the middle class but the lower strata of  society as well who are consumers in many ways. Since the service tax also applies to mobile bills and cable TV, the lower middle class will also be among the main sufferers,” said Ajay Jagga, a city-based income tax consultant.
“The increase in the service tax will badly affect the daily life as all services will become more expensive,” said Sanjay Malhotra, an indirect tax consultant. Other services such as consulting lawyers and membership of gyms and clubs will also cost more from the next financial year. Not only will buying new property become more expensive, property owners paying lease money will also end up paying more.
“The hike in service tax is because the government has announced to move towards the implementation of the Goods and Services Tax (GST)  from April 1, 2016. The service tax is going to go up from 14 per cent if the GST is implemented,” said Pushpinder Duggal, a member of the executive committee of the  Chandigarh branch of Institute of Chartered Accountants of India.