A Cess which shall be levied and collected in accordance with the provisions of Chapter VI of the Finance Act, 2015 called Swachh Bharat Cess, as service tax on all the taxable services at the rate of 0.5% of the value of taxable service. SBC is not a cess on Service Tax. 

SBC would be calculated in the same way as Service tax is calculated. Therefore, SBC would be levied on the same taxable value as service tax.

notification No 21/2015-ST dated 6th November 2015 notifies 15th day of November, 2015 as the date from which provisions of Swachh Bharat Cess will come into effect.

The Central Government vide notification No 22/2015-ST dated 6^th November 2015, has notified that SBC shall be applicable on all taxable services except services which are either fully exempt from service tax under any notification issued under section 93(1) of the Finance Act, 1994 or are otherwise not leviable to service tax under section 66B of the Finance Act, 1994.

In other words, it is not leviable on services which are fully exempt from service tax or those covered under the negative list of services.

SBC would be levied, charged, collected and paid to Government independent of service tax. This needs to be charged separately on the invoice, accounted for separately in the books of account and paid separately under separate accounting code which has been notified vide Circular No. 188/7/2015-ST dated the 16^th November, 2015.

Besides that SBC may be charged separately after service tax as a different line item in invoice. It can be accounted and treated similarly to Education cesses.

The very popular Reverse Charge Mechanism wherein the liability has been shifted from service provider to the service recipient to pay service tax under section 68(2) of the Finance Act, 1994. In regard to RCM, it would be pertinent to note that the provisions of Chapter V of the Finance Act, 1994, and the rules made thereunder are also applicable to SBC as per section 119 (5) of the Finance Act, 2015 mentioned above in relevant extract. Thus, the reverse charge under section 68(2) of the Finance Act, 1994, is made applicable to SBC.

The same has been clarified vide notification No. 24/2015-Service Tax dated 12th November, 2015 to provide that reverse charge under notification No.30/2012-Service Tax dated 20th June, 2012 shall be applicable for the purpose of levy of Swachh Bharat Cess mutatis mutandis.

Taxable services, on which service tax is leviable on a certain percentage of value of taxable service, will attract SBC on the same percentage of value as provided in the notification No. 26/2012-ST, dated 20th June, 2012.