The service tax rate on IT services is currently 15%. The commended standard rate is estimated to be about 17–18% and the revenue neutral
rate is at 15–15.5% . As a result, IT service costs will lift up, chiefly for end consumers who do not allege the tax input credit. The packaged
software as per the current tax structure is permitted to both VAT (approximately 5%) directed to the state government and service tax (15%)
follows the central government. Due to the lack of clarity from the government, at times excise duty is also applied. Nonetheless,
once the GST is implemented it is anticipated that, the existing average tax rate of around 25–35% shall come down to around 18–25%.