amount is subject to up to an 8 additional tax by considering this to be a works contract it could almost finish off this industry just as it is about to take off the sector is facing other disputes on taxability of lease rentals and credit available for inputs against service tax liability on lease rentals but these are trivial as compared to the main issue on works contracts but also need clarification it seems that this industry is too important for the government to take a view that such issues should be left to the industry to sort out through recourse to litigation therefore if the government takes a holistic view of the tax burden on this industry it can enact appropriate measures to make the tax burden moderate clear and easy to determinethe author is partner leaderindirect tax ernst young india