Travelling by air conditioned trains will become marginally costlier from now onwards, as the government has decided to impose 0.5 per cent ‘Krishi Kalyan’ cess on service tax. The ‘Krishi Kalyan’ cess will be imposed on all air conditioned train tickets, including coaches like freight and parcel.
The Indian Railway Ministry has announced that the overall impact of service tax on fares of AC coaches will be 0.15 percent. The tax is not applicable on non AC coaches and sleeper class travel. Increase in service tax will be applicable on all tickets of AC coaches issued after June 1, 2016. It will not be levied on train tickets purchased before June 1.