DVAT on Job Work ( Garment Trade )

[sanjay malviya]

Dear Expert

Please advice what DVAT rate applicable on job work in garment industry

Thanks 

Sanjay

AI Summary

DVAT Rate on Garment Industry Job Work Hinges on 'Works Contract' Status, Generally 12.5%, Potentially 4% on Declared Goods. A query was raised regarding the applicable Delhi Value Added Tax (DVAT) rate on job work in the garment industry. The response explained that the tax rate depends on various factors, including whether the work is considered a 'works contract,' which involves agreements for construction, manufacturing, or processing. Under the DVAT Act, the tax rate for works contracts is generally 12.5%, but it can be reduced to 4% on certain declared goods. The explanation also covered valuation methods for works contracts, tax deduction at source (TDS) obligations, and examples of computing taxable turnover and VAT for contracts.