VAT (value added tax) has replaced sales tax in India, including in Maharashtra, to establish a uniform, transparent taxation system. VAT is collected from producers and sellers on the incremental value added at each stage of production and distribution. In Maharashtra, VAT is governed by the MVAT Act and applies to the sale of goods at rates from 1-20% according to schedules. Key VAT concepts include the definition of goods, dealers, importers, and sales/purchase prices. Manufacturers and businesses with over 1 lakh annual sales or 10,000 rupees of taxable purchases/sales annually must register and file VAT returns electronically monthly, quarterly, or half-yearly.
2. Introduction
VAT is a system of indirect taxation, which has been
introduced in lieu of sales tax.
It is the tax paid by the producers, manufacturers, retailers
or any other dealer who add value to the goods and that is
ultimately passed on to the consumer.
VAT has been introduced in India to ensure a fair and
uniform system of taxation. It is an efficient, transparent,
revenue-neutral, globally acceptable and easy to
administer taxation system.
It benefits the common man (consumer), businessman
and the Government.
3. Earlier the State of Maharashtra had introduced VAT in respect
of very few specified items under the old Bombay Sales Tax Act.
The entire Bombay Sales Tax Act and certain related taxes got
replaced by the Maharashtra Value Added Tax Act (MVAT Act),
2002 with effect from 1st April 2005
VAT, a globally recognized sales tax system, has been
introduced in more than 130 countries
VAT in Maharashtra is levied under a legislation known as the
Maharashtra Value Added Tax Act (MVAT Act), 2002,
supported by Maharashtra Value Added Tax Rules (MVAT
Rules). VAT is levied on sale of goods including intangible
goods.
Rate of VAT applicable in the country is between 4 % to 12.5%
4. Payment, Due Date & Penalty
Payment
VAT needs to be paid on a Monthly, Quarterly or half
yearly basis
Due Date
Monthly/ Quarterly – 21 Days
Half Yearly – 30 Days
Penalty
Rs. 5000/-
5. Applicability of VAT
Goods Rate Items Covered
Schedule A Nil Tax free Goods
Schedule B 1% Gold, Silver, Precious Metal and Stone
Schedule C 4% Goods used for industrial Input
Schedule D 20% Foreign Liquor, Indian Liquor, Molasses, High Speed
Diesel Oil
Schedule E 12.5% Remaining
6. Few Concepts
Goods
“Goods” means every kind of moveable property
Does not include: Newspapers, actionable claims,
money, stocks, shares, securities or lottery tickets
Includes: Live stocks, growing crop, grass and trees
and plants including the produce thereof including
property in such goods attached to or forming part of
the land which are agreed to be severed before sale or
under the contract of sale;
7. Dealer
“ Dealer” refers to a person who buys or sells goods
within the state for a valuable consideration.
8. Importer
“Importer” means a dealer who brings any goods into
State or to whom any goods are dispatched from any
place outside State;
9. Purchase Price
“Purchase Price” means the amount of valuable
consideration paid or payable by a person for any
purchase made including any sum charged for
anything done by the seller in respect of the goods at
the time of or before delivery thereof, other than the
cost of insurance for transit or of installation,
when such cost is separately charged.”
10. Sale
“Sale” means a sale of goods made within the State for
cash or deferred payment or other valuable
consideration but does not include a mortgage,
hypothecation, charge or pledge.
11. Sales Price
“Sale Price” means the amount of valuable
consideration paid or payable to a dealer for any sale
made including any sum charged for anything done
by the seller in respect of the goods at the time of or
before delivery thereof, other than the cost of
insurance for transit or of installation, when such
cost is separately charged.
12. VAT Applicability
Importer
1. Annual Sales Turnover should be above 1 lakh
2. In a year the value of the taxable goods sold or
purchased should be more than Rs. 10,000/-
13. Other
Annual Sales turnover should be more than 5 lakhs
In a year the value of the taxable goods sold or
purchased should be more than Rs. 10,000/-
14. E - Registration
Location
Name of Business
Name of Applicant
Status of Applicant
PAN
Select : MVAT , CST Act
Request ID & Retreival
15. Filling the form on-line
Acknowledgement
Physical Submision of Form & Documents
Personal Attendance of Applicant for Photo-sign.
Obtaining TIN Allotment Letter
E-services enrollment & Submission of its
Acknowledgement.
16. Filing of MVAT
E Registration is required
Download – Forms – Electronic forms –
- e-applications for CST forms
Off-line filling of Forms
E-Application for CST Forms C / F / H / E-I/ E-II
Location of Main POB
CST RC/TIN of Form accepting Dealer
Period of Transaction (for F Forms -Monthly, for
Others-Quartrerly, Half Yearly)
Total No. of Transactions
Total Value of Transactions
Description of Major Goods
17. Validation of File
If error shows, open Error Sheet and correct the errors
On Validating again, –Rem.txt file is generated in My
documents folder
Dealer Login & Password
E-Services - E-CST Declarations
Browsing and uploading
Acknowledgement