Electricity Duty and VAT

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Querist : Anonymous

Querist : Anonymous (Querist)

13 December 2010 Currently almost state had imposed electricity duty on electricity consumer. It ranges from 5% to 15% depending upon the state. Looking at the nature of taxation it is service tax on service provided. All tax paid to on goods and services under Central Government rule are VAT able under various provision of similar act. ( Like Excise Duty and Cenvat Credit).
Similarly state had imposed electiricity duty on electricity consumer. Looking at current scenario VAT credit is not available. I would like to understand the understanding on the constitutional provision and nature of electricity duty.

Don’t we think that it should be adjusted against the local sales tax.

CA Shailesh Kumar Bhagat

CA Shailesh Kumar Bhagat (Expert)

13 December 2010 If local tax will be adjustable, what aboute excise duty.

electricity is kept exempted from excise duty since it doesnot come under "goods"

There are some basic reason to levy taxes as per the constitution.

Querist : Anonymous

Querist : Anonymous (Querist)

18 December 2010 I think you have just given the basic fact which is known to every one. I discussing some thing very deeper. Electricity duty is imposed by state as such there is no tax on electricity. This have cascading effect as not MODVAT is avaiable on this. Pls read the facts and try to investigate very thoroughly.

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