New Delhi, Feb. 28: The finance minister has cast the service tax wide by extending it to 21 new areas. The services sector accounts for about 52 per cent of the GDP.

Finance minister P. Chidambaram said he planned to mop up Rs 17,500 crore next fiscal from service tax, up from Rs 14,150 crore to be mobilised during 2004-05.

The service tax rate has been maintained at 10 per cent allaying fears of a hike that had swirled ahead of the budget.

The new services that will now come within the ambit of the levy are services like construction of residential complexes and apartments, excavation and earth moving, transport of goods through pipeline, dredging in rivers and ports, club membership, and packaging and mailing services.

Other activities like survey and map-making by private firms, cleaning services, other than those involved in farm sector, will also come within the service tax net.

Service tax will also be applicable to existing services like renovation of building and civil structures, broadcasters providing direct to home (DTH) transmission, reconditioning and restoration of motor cars and manpower recruitment firms providing temporary jobs and others. Videotape production and sound recording for remixes will also attract service tax.

However, the finance minister has also provided relief grant to small service providers. Those service providers have been exempted from this tax, whose gross turnover does not exceed Rs 4 lakh per year.

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"According to my calculation, 80 per cent of the service tax payers will gain from the exemption," said Chidambaram.

It was in the budget announced last July that the service tax was raised to the present level of 10 per cent. The finance minister has also said that there is a proposal to expand the coverage of certain services.

A couple of other changes are being made the service tax rules. The first is that the invoice should be issued within 14 days from the date of the completion of the provision of service or receipt of payment whichever is earlier.

The due date for service tax payment will be the fifth of the following month or quarter as the case may be.

The rules will also now enable centralised registration of more than one premises.

Lastly, the liability of payment of service tax on business auxiliary services provided by the distributors of mutual funds will be on the recipient of the services, namely, mutual funds.