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VAT Rates in India

VAT Rates in India 6

BY INDIAFILINGS ON NOVEMBER 7, 2014 BUSINESS STARTUP, TAXATION, VAT/CST

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VAT Rates in India

VAT or Value Added Tax is a tax added to the goods at each step of the production and distribution process. VAT tax
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however is ultimately paid by the end consumer, as dealers are allowed to collect VAT tax on their sales, retain the
tax paid on their purchases and only pay the balance to the Government. Unlike service tax, VAT is still governed by
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the State Government by separate VAT act passed by each of the state in India under the guidelines issued by
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anEmpowered Committee to ensure uniformity. Therefore, the procedure for VAT Registration, the VAT Rates, due
date for VAT payment, deadline for VAT Return Filing and other modalities differ from State to State. In this article,
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we look at the VAT Rates prevalent in some of the major states in India and the relevant schedules:

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VAT Rates in India
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The VAT Rates in India will differ based on the type of goods and from State to State. Therefore, it is important for
the Entrepreneur to be conversant with the States regulation with respect to VAT. However, VAT Rates in India can
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be divided into three main categories, which are common for many states:
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VAT Exempted Category / NIL VAT Rate

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In many states, items that are sold by the unorganized sector in natural or unprocessed format and basic goods for
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the poor are listed under the VAT exempted category. Some of the items that may be VAT exempt in many state
include: aids used by handicapped persons, glass or plastic bangles, condoms, firewood, khadi, salt, etc.,

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In many states, 1% or 2% VAT Rate is applied for precious stones, precious metals like silver, gold and platinum,
bullions, jewellery, etc., POPULAR TAGS

4% or 5% VAT Rate
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Many states have adopted a VAT Rate of 4% or 5% for a large number of basic necessity goods. Some of the goods
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included in this category in many of the States include coffee, coir, cotton, edible oils, medicines, drugs, agricultural
implements, etc.,
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General VAT Rate
Business Startup
In addition to the above VAT Rates, many states also have other levels of VAT based on the Goods. Very high VAT
Rate of over 20% is usually levied for goods such as imported liquor, cigarettes, etc., Many states also have a
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General VAT Rate of around 12.5% which is meant as a catch-all for goods not falling in any of the listed category. Copyright
This category of goods not falling in any of the other category are usually taxed at 12.5% or 13.5% or 14% depending
on the State. Doing Business in India
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VAT Rates in India by State
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The following are the prevalent VAT Rates in some of the major States of India: Foreigners Starting a Business in
India
Delhi VAT Tax Rates Schedule
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Maharashtra VAT Tax Rates Funding GST in India Import - Export
Karnataka VAT Tax Rates
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Tamil Nadu VAT Rate Schedule
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As VAT rates change based on the State and the goods being sold, it is important for the dealer to be fully aware of Limited Liability Partnership
the relevant VAT Rates for the goods or products sold by the dealer and comply with the relevant regulations.
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For more information about VAT Rates in India, visit IndiaFilings.com Non-Resident Indians Not for Profit

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DINESH on MAY 17, 2015 12:43 PM FSSAI License Requirements

Hi,
Can any one help me on this below point:-
I have purchased the flat in Bangalore for 68L, please can you advise me what would be the VAT and

service tax rate that i have to pay?

Thanks

SOHIL SETHI on JULY 4, 2015 9:48 PM

Hi ,
http://www.indiafilings.com/learn/vatratesindia/ 2/4
12/22/2015 VATRatesinIndia
Hi ,
I just want to know how much VAT / CST is charged on car air freshners / perfumes ?
Please let me know.

KEDAR on JULY 5, 2015 9:38 AM

Name of company/service: PantaloonsWe made some purchases from Pantaloons because they were
having some sales. There was upto 50% off on most items. However they kept announcing that VAT will
be added. Upon receiving the bill it was quite clear that VAT was added to the MRP.The amount was 5%
on clothes and 12.5% on shoes.I have found out that it is illegal to charge VAT on the MRP as MRP
includes all the taxes and they can only deduct the discount and are overcharging in the bargain. I
would like to complain against this brand so that they do not cheat their consumers.

LIYO.M.C on JULY 9, 2015 11:10 PM

hello i have purchased the flat in ernamkulam for 50lakh please tell me what would be the vat and
service tax to pay and one more is it a input vat

MANJUNATH G on SEPTEMBER 7, 2015 12:08 PM

hi, Thank you for the information!!! very usefull!

i have one question though, can you please suggest us how much is the VAT in Karnataka for machined
products that are not end products but are sub products to a second company.

GIRISH AHUJA on NOVEMBER 21, 2015 3:37 PM

i am planning to start new business in Mumbai (Maharashtra) for shopping bags.Goods will be
purchased from Gujarat and sold at Mumbai.
I am eligible to apply for Vat registration at Mumbai only on achievement of turnover of 5.00 lacs
Can you please explain the implications of CST and VAT on my transactions.
Thanks
Girish

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