Dear Sir
Kindly advice for service tax & vat
We are Govt Contractor (eligible for Advertising & Construction work)
Kindly advice for bifruction of service tax & vat
How much we have to charge vat & service tax on single bill(Service & Material both used in 1 Bill)
Guidance Issued on Service Tax and VAT for Contracts: Charge DVAT at 12.50% and Service Tax at 4.80% or 12.36%. A government contractor inquired about the bifurcation of service tax and VAT for contracts involving both services and materials. The response advised charging DVAT at 12.50% on 75% of the contract value if separate accounts for labor and materials are not maintained. For service tax, a rate of 4.80% on the gross contract value applies if the contractor is a corporate body; otherwise, the reverse charge mechanism is applicable. Alternatively, service tax can be calculated at 12.36% on 40% of the contract value or by bifurcating the value of goods under Rule 2(A). (AI Summary)
TaxTMI 
TaxTMI 
