Madhya Pradesh govt clears air on VAT

To clear confusion among traders on the value-added tax, the MP government today endorsed some VAT rules and clarified that a turnover of Rs 500,000 did not fall under the ambit of VAT.

Traders will be allowed to de-register from the VAT list provided they deposit the tax collected from April 1 to the date of de-registration so the consumers can get input rebate on VAT.

The state government also capped the number of visits of auditors to the traders. "Auditors can pay three visits to a trader with a turnover of Rs 5 crore, five visits to a trader with turnover of Rs 10 crore and ten visits to a traders with a turnover of Rs 100 crore," a government spokesperson said.

Military canteens have been exempted from VAT and will be offered transferable input rebate on the purchase of those commodities where more than 4 per cent VAT has been paid.

"The canteens can transfer this input rebate to a traders for purchase of commodities in future," said the spokesperson.

Those firms which have been offered tax deferment facilities will be offered transferable input rebate if their tax liabilities falls in negative territory.

Those manufacturers who seek composition scheme facility under VAT rules will be allowed to purchase any commodity from non-registered traders provided commodity should not attract 12.5 per cent VAT.