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    VAT in Meghalaya: Rates, Eligibility, Registration Process & Fee

    vat in meghalaya
    Source: cloudfront

    Value Added Tax or VAT in Meghalaya was introduced in 2003. The government levied this indirect tax on goods and services when the commodities were sold to the buyer. As a result, the manufacturers and sellers passed the liability for paying the VAT on consumers.

    In this state Value Added Tax Act or Meghalaya Value Added Sales Tax Act regulates its implementation. Since this tax has multiple stages, the state government has made guidelines under the Meghalaya VAT Act to maintain the smooth implementation of this taxation system.

    What Is Value Added Tax?

    what is value added tax in meghalaya
    Source: cdn.extra

    Value Added Tax is a form of indirect tax like Excise duty levied on the sales of goods and products. Its implementation and guidelines vary from one state to another as the state governments are in charge of the proceeds coming from VAT.

    VAT was an integral part of the nation's GDP, even though it had a cascading effect on the economy. Additionally, any business or individual whose annual turnover is equal to or more than ₹ 5 Lakhs must register the business to pay VAT to the state government. However, the Meghalaya VAT rules might differ from other states' VAT rules and will only extend to Meghalaya.

    What Are the VAT Rates for Goods or Services in Meghalaya?

    The VAT rates in Meghalaya are imposed under 5 categories or schedules. The schedules and tax rates are explained below:

    Schedules

    Applicable Goods and Services

    VAT Rates in Meghalaya

    Schedule 1

    Consists of 65 goods, some manually implemented or animal-driven agricultural tools, aquatic, poultry & cattle feed, condoms & contraceptives, books, charcoal, betel leaves and more.

    0%

    Schedule 2

    Bicycle, tricycle, rickshaw, bamboo, all metal castings, cassia leaves and more out of 150 commodities.

    5%

    Schedule 2(A)

    Consists of 30 types of I.T products, including electronic computers, I.T software or any media, and telephone answering machines.

    5%

    Schedule 2(B)

    Non-medical liquid glucose, copper ore and concentrates, crude oil, refined oil, and more. This category has about 167 kinds of packing materials and industrial inputs.

    5%

    Schedule 3

    Gold, silver, and precious and semi-precious stones like diamonds, emeralds, pearls and more. It also includes platinum and bullion.

    1%

    Schedule 4

    Work contracts, lease transactions, and other goods and products are not covered in the other schedules.

    14.5%

    Schedule 4(A)

    Making and installing plant machinery, elevators, computer software programming, shipbuilding, and other industrial works.

    10%-30%

    Schedule 5

    Liquor, molasses, lottery tickets, tobacco and its derivatives, tea leaves and more.

    20%-27%

    Who Should Pay VAT in Meghalaya?

    People who are liable to pay VAT in Meghalaya include:

    • Dealers whose annual business turnover is equal to or more than ₹ 1 Lakh
    • Any dealer whose turnover surpasses their taxable quantum
    • Business owners are liable to pay tax under any of the laws that this Act or any other Central Sales Tax Act, 1956 has reversed
    • Sellers are liable to pay taxes if they affect the deal

    How to Register for VAT in Meghalaya Online?

    Any dealer can register with the Excise Registration Taxation Stamps Department or choose to e-Register for VAT in Meghalaya through the official portal. E-registration service allows business owners to fill out the forms online and apply for VAT registration certificates without hassle.

    The steps to register for VAT online are as follows:

    Step 1: Log in to the official website

    Step 2: Navigate to the "services" tab and search for Excise Registration Taxation Stamps Department in the Department/Office Wise section

    Steps 3: Click on online VAT registration

    Step 4: There are 9 tabs in the registration module

    Step 5: Initially, applicants can only access two tabs, and these are "registration guide" and "dealer details"

    Step 6: Applicants who want to apply for fresh registration need to navigate to "dealer details"

    Step 7: One can only move further after filling up all information in the "dealer details" segment

    Step 8: Dealers need to input their current email and phone number so that authorities can contact them when required

    Step 9: Applicants also need to fill up a certain form. These Meghalaya VAT forms include:

    • Form 1 – This form is an application for registration
    • Form 2 – This is a certificate of registration under Section 31
    • Form 32 – This is a tax invoice form
    • Form 17 – This form is for declaration for importing taxable products into Meghalaya
    • Form 18 – This form is a declaration for taxable shipping goods outside Meghalaya
    • Form 39 –This is a tax clearance certificate

    Step 10: One also needs to upload scanned copies of certain documents. These documents include:

    • PAN
    • EPIC
    • Labour Certificate
    • Headman Address Proof Certificate
    • Trading Licence from District Council
    • Municipal Licence

    Step 11: After providing all the information, one needs to click on the save button and then submit

    Step 12: Post submission of data and documents, the portal will send a system-generated application number, which the applicant can use in the future for tracking purposes

    Step 13: Dealers will receive email on SMS for certificate collection

    How to Pay for VAT Registration Fee in Meghalaya Online?

    Dealers can pay the VAT registration fee online as well. One needs to follow the steps below:

    Step 1: After the registration request is submitted through the official website, the applicant will be redirected to the online payment page

    Step 2: From there, they can enter their bank details and pay the registration fee

    After a successful transaction, one will receive an acknowledgement slip and number which the applicant must maintain carefully.

    How to File a Return Against the VAT Payment in Meghalaya?

    Registered users can file for return against the VAT payment in Meghalaya online. In order to do so, one can follow the steps below:

    Step 1: Visit the official website

    Step 2: Registered users need to again submit certain documents like PAN, EPIC, Labour certificate, Municipal Licence, Trading Licence from District council, Headman address proof certificate, etc

    Step 3: Further under Section 35, applicants also need to fill up some forms for submission of periodic returns and payments of tax. These forms are:

    • Form 5 – This form is for tax returns that are to be submitted 21 days before the close of the tax period
    • Form 6 – This form is for annual returns that are to be submitted 30 days before the end of the year
    • Form 54 – This form is for registered dealers.

    How Is VAT Different from GST in Meghalaya?

    The introduction of Goods and Services Tax (GST) has overshadowed the use of VAT in most Indian states. The main reason for GSTs popularity is that it eliminates the cascading effect that indirect taxes have on the economy, especially the VAT.

    Moreover, VAT has been merged into GST for most goods and services. Different VAT rates and rules in every state was not a very practical thing to do. Also, in the case of GST, the consumer tax collects the tax instead of the seller state; hence the liability of paying for the taxes is removed from the buyers. However, VAT is still levied on certain goods like petrol.

    This blog discussed VAT in Meghalaya and covered aspects like registration, e-payment and e-filing.

    Frequently Asked Questions

    Will I have to pay the penalty if I fail to register for VAT payments in Meghalaya on time?

    Yes, dealers will be penalised if they fail to register on time. Moreover, each month the dealer will be levied around ₹ 5000 to ₹ 10,000 penalty fee.

    Yes, dealers will be penalised if they fail to register on time. Moreover, each month the dealer will be levied around ₹ 5000 to ₹ 10,000 penalty fee.

    What is the rate of VAT applied on petrol in Meghalaya?

    The rate of VAT on petrol in Meghalaya is ₹ 10.79 per litre {13.5% of (fuel price charged to dealers + excise duty + avg. dealer commission)} (an additional pollution surcharge of ₹ 0.10 on VAT).

    The rate of VAT on petrol in Meghalaya is ₹ 10.79 per litre {13.5% of (fuel price charged to dealers + excise duty + avg. dealer commission)} (an additional pollution surcharge of ₹ 0.10 on VAT).

    What is the rate of VAT applied on diesel in Meghalaya?

    Meghalaya levies 12% VAT on diesel.

    Meghalaya levies 12% VAT on diesel.

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    Last updated: 2023-12-05

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