A manufacturer want to sale his product in Rs 110/ where his
manufacturing cost is 100.what will be tax for the product
in different way.If he want to sale his product outside the
state then what will be the taxation way. I want to know as
urgent.Hope you will describe me as brakewise statement
with example.
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Answer / Atul Sahu
Let's break it down:
1. If the manufacturer wants to sell within the same state (Intra-state), there might be Value Added Tax (VAT) or Goods and Services Tax (GST). Assuming a GST rate of 18% on the sale price, the tax would be Rs. 19.80 (Rs. 110 * 18/100).
2. If the manufacturer wants to sell outside the state (Inter-state), there might be Central Value Added Tax (CENVAT) or Inter-State Sales Tax (ISST). Assuming a CENVAT rate of 4%, the tax would be Rs. 4.40 (Rs. 110 * 4/100). In this case, you should also consider Origin-based Cenvat Credit rules for input tax credit.
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