WCT on Service Tax

[Bhairob Chandra Bor]

Dear Sir,

Work Tax liability where the gross construction bills are inclusive of service tax. Kindly explain should we deduct the WCT on the service tax also? ( Basic ₹ 100 + Service Tax ₹ 12 =Gross bill Rs.112).

Kind Regards,

bcb

[Ramanujam Varadarajan]

There is no specific exclusion under VAT provisions but still generally not required to be applied on service tax component. Under Income tax provisions, there is exclusion of Income tax TDS on service tax component.

AI Summary

Works contract tax applicability: service tax component generally excluded from WCT; income-tax TDS expressly excludes it.
Whether WCT should be computed on the service tax element in gross construction bills: there is no specific exclusion in VAT/works-contract legislation, but practice is generally not to apply WCT to the service tax component; income-tax withholding rules expressly exclude service tax from TDS calculation.