#dvat

Ease of doing business – Delhi VAT

As we know that every dealer is required to get himself registered under DVAT, if his turnover exceeds taxable quantum i.e. Rs. 20 lakh in current year; or to pay tax, or is registered or required to be registered under Central Sales Tax Act, 1956.

Department has been focusing on “Easy of Doing Business”and to proceed it further the Department of Trade & Taxes, Govt. of NCT of Delhi, has decided…

New Post has been published on http://www.onlinelawsolutions.com/index.php/2016/03/30/dvat-vat-deduction-respect-works-contract/

DVAT: VAT deduction in respect of Works Contract

  GOVERNMENT OF NATION CAPITAL TERRITORY OF DELHI

DEPARTMENT OF TRADE AND TAXES

(POLICY BRANCH)

VYAPAR BHAWAN: I.P. ESTATE, NEW DELHI- 110 002

No.  F.3(654)/Policy/VAT/2016/1800-1802

Dated 28/03/2016

To

All Central Government Ministries/Departments/Directorates/PSUs/ Corporations/ Boards/ Authorities etc.

All Delhi Government Departments/Directorates/PSUs/ Corporations/ Boards/ Authorities etc.

All other Government Departments/Directorates/PSUs/ Corporations/ Boards/ Authorities etc. having their offices functioning within the National Capital Territory of Delhi

Sub: VAT deduction at source in respect of works contracts.

Sir,

It is to bring to kind notice of all that section 36 A of the Delhi Value Added Tax Act, 2004 requires every person, at the time of making payment or credit to a contractor, to deduct TDS @ 4%, if the contractor is a registered dealer or @ 6% in case the contractor is unregistered. The amount so deducted by such person (i.e. the contractee) is required to be deposited to the Delhi Government Treasury within a period of 15 days following the month in which such deduction is made. Failure to deduct TDS entails penalty apart from liability of interest.

It has come to the notice of the Trade & Taxes Department that some of the Government Departments are carrying out the works contract activities by assigning the various departmental contracts to the contractors. Under the provision of DVAT Act 2004, it is the responsibility of such departments to deduct TDS on the payments made to the contractors to whom the works contract has been assigned. Secondly, it has also been noticed that some of the government departments are assigning the works contracts to other government agencies being specialized in the field for execution of deposit works.

In view of above, as deduction of VAT at source being mandatory in respect of works contracts, all the government departments are advised to deduct at source the TDS in accordance with the provisions of Section 36A of DVAT Act, 2004 and deposit the same with the Trade & Taxes Department which is otherwise their duty to do so and the failure would tantamount to attracting the penal provisions under the said Act.

Yours faithfully

(S. S. YADAV)

New Post has been published on http://www.onlinelawsolutions.com/index.php/2016/03/30/delhi-budget-2016-vat-rates/

Delhi Budget 2016- VAT Rates

  Deputy Chief Minister of Delhi Manish Sisodiya presented the Annual Budget for 2016-17 in Assembly on 28.03.2016 and  has made several rate changes in VAT.

VAT rates has been reduced which may result in reduction in prices of readymade garments, shoes, watches and electric and hybrid vehicles.

Extract of Budget:

“Sir, in the tax revenue, VAT constitutes the major part of our receipts, with nearly 65%- of total collections – and most of our developmental activities depend mainly on the buoyancy and elasticity of tax revenue from VAT. My taxation proposals are founded on the following principles:

The first and foremost principle of our taxation policy is to maintain the distributive character of Delhi’s trade.

Secondly, it is simplification of the existing system and promotion of an all-round ease of doing business.

Thirdly, multiple entries relating to the same item or a common group of items are a great source of ambiguity and confusion, which leads to harassment of traders and create a window for reporting manipulation leading to undesirable behaviour. We have tried to simplify it by bringing them under one entry to the extent possible.

Fourthly, our Government is fully committed to reducing tax arbitrage and will attempt to keep a uniform rate with neighbouring states. In several items such as sweets – namkeen, watches, readymade garments, lower tax rate in neighbouring States was causing erosion in the same. We have made efforts to remove such imbalances in our VAT structure.

Last and most important principle which is the motive force behind our taxation policy is to encourage voluntary compliance, and forge a strong partnership with the trade and the public.

Having regard to the above objectives, I propose modifications in the VAT rate which can be classified into two parts :

Reduction in VAT rates

GOVERNMENT OF NATIONAL CAPITAL TERRITORY

DEPARTMENT OF TRADE & TAKES

VYAPAR BHAWAN : I.P.ESTATE: NEW DELHI -110 002

No.F.3(375)/Policy/VAT/13 /923-926  Dated: 25.10.2013

It is to inform that, the dealers, while applying for new registration with the…