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.
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.
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% |
People who are liable to pay VAT in Meghalaya include:
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:
Step 10: One also needs to upload scanned copies of certain documents. These documents include:
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
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.
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:
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.
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Disclaimer: This information is added only for informative purposes and collected from different sources across the Internet. Digit Insurance is not promoting or recommending anything here. Please verify the information before making any decisions.
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