My student got Export Order of Java Peanuts but buyer asked to do Pre-shipment inspection of goods. All company is asking for a purchase bill. Now 5% VAT has to be paid to mfg unit if purchased against bill. My student (Exporter) does not have reg. in VAT department as it is too costly in Gujarat (need to pay 25,000 adv. Tax), so how can he avoid VAT in legal sense ? How can he export goods tax free & earn reasonable profit. He is earning total 9.5% profit in this deal. If he pays VAT (which he should not pay as it is exports) he will get -5% = 4.5% profit.
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Student Faces VAT Challenges on Java Peanuts Export; Seeks Legal Advice on Registration and Compliance A student received an export order for Java Peanuts but faced challenges due to a requirement for pre-shipment inspection and the necessity of a purchase bill, which incurs a 5% VAT. The student, not registered with the VAT department due to high costs in Gujarat, sought advice on legally avoiding VAT to maintain profitability. Responses suggested that VAT can only be avoided by being a registered dealer. It was clarified that voluntary registration requires a 25,000 deposit unless turnover exceeds certain thresholds, which the student does not meet. The discussion emphasized the legal requirements for VAT registration and export procedures. (AI Summary)
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