TaxTMI 
TaxTMI 
WE ARE MFG. OF LABEL IN GUJARAT BASE WE PURCHASE PAPER ROLL (ADHESIVE) (UNDER EXCISE TARIFF HEAD 48) AND POLYESTER ROLL (UNDER EXCISE TARIFF HEAD 3919) AND MFG. LABEL. IN GUJARAT VAT WE CHARGES LABEL SALES PAPER LABEL & POLYESTER LABEL 5% VAT RATE IN SALES INVOICE (UNDER EXCISE HEAD 48). MY QUERY IS PAPER LABEL & POLYESTER LABEL ARE DIFFERENCE RATE CHARGES 5% OR 12.5% WHICH SCHEDULE UNDER WE HAVE FIND WHICH RATE APPLICABLE.
GUJARAT VAT RATE APPLICABLE
07 Oct 2015 
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VAT classification for self-adhesive polyester inputs determines applicable sales tax rate on finished label products under state law.
Whether polyester self adhesive film purchased by a label manufacturer qualifies as an industrial input determines whether reduced VAT treatment applies to the finished labels; if the film is not an industrial input, the higher VAT rate applicable to finished polyester labels will apply. The dispute arises from differing interpretations of excise/tariff descriptors and the state VAT schedule linking input classification to the rate on finished goods. (AI Summary)
Whether polyester self adhesive film purchased by a label manufacturer qualifies as an industrial input determines whether reduced VAT treatment applies to the finished labels; if the film is not an industrial input, the higher VAT rate applicable to finished polyester labels will apply. The dispute arises from differing interpretations of excise/tariff descriptors and the state VAT schedule linking input classification to the rate on finished goods. (AI Summary)