The Modi government is set to hike the service tax rates to 18 percent from the current 15 percent in the budget. Union Finance Minister Arun Jaitley had raised service tax by 0.5 per cent last year. This is for the third time that service tax will be hiked. With an increase in service tax, phone bills, airfare and eating out in hotels will become dearer. The economists say that service tax is being raised to make one nation, one tax in reality.