about the vat rate of selling raw material

[MEHUL ASHAR]

Respected Sir,

                         I have got a raw material charged at 15% but on my product I have to charge 5% so if I want to sale that raw material then I have to charge 15% or 5%.

[YAGAY and SUN]

If you are selling rawmaterial as such then you would have to reverse the Input Tax Credit so availed.

AI Summary

Reversal of input tax credit required when selling raw material purchased for a higher taxed supply as such. When raw material is sold as such the sale is taxed at the rate applicable to that raw material and, where input tax credit was availed on its acquisition, that input tax credit must be reversed upon such sale.