Entry tax

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

04 April 2013 Sir,

Please clarify,

1. What are the expenses included while calculating the entry tax?

2. Whether exise duty and customs duty included or not?

3. What amount we have to Dr Plant & Machinery including exise duty or not if exise credit has taken?

4. Whether entry tax should be Dr Plant & Machinery

Querist : Anonymous

Querist : Anonymous (Querist)

04 May 2013 Dear Sir,

Please clarify soon

Querist : Anonymous

Querist : Anonymous (Querist)

10 May 2013 Sir,

I am waiting for expert answer

Querist : Anonymous

Querist : Anonymous (Querist)

10 May 2013 Sir,

I am waiting for expert answer

Asha Kanta Sharma

Asha Kanta Sharma (Expert)
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21 July 2024 Here are the clarifications to your queries regarding Entry Tax:

1. **Expenses included in calculating Entry Tax:**
Entry Tax is generally levied on the entry of goods into a local area for consumption, use, or sale. The tax is usually calculated based on the value of the goods at the time of their entry. The expenses included for calculating Entry Tax can vary by state, but typically include the purchase price of the goods, freight charges, insurance costs, and any other charges incurred to bring the goods to their current location within the state.

2. **Inclusion of Excise Duty and Customs Duty:**
Whether Excise Duty and Customs Duty are included in Entry Tax calculations depends on the specific tax laws of the state. In some cases, these duties might be excluded if they are separately levied and collected by the Central Government. It's advisable to refer to the state's Entry Tax rules or seek clarification from the state tax department to determine their inclusion.

3. **Treatment of Plant & Machinery in Entry Tax:**
- If Excise Duty credit has been availed: When entering Plant & Machinery subject to Entry Tax, if you have already availed Excise Duty credit, the value for Entry Tax purposes typically includes the base price of the Plant & Machinery excluding Excise Duty. The Entry Tax is then calculated on this base price.
- If Excise Duty credit has not been availed: In this scenario, the value for Entry Tax would generally include the total value of the Plant & Machinery including Excise Duty, as you haven't claimed credit for it.

4. **Entry Tax Accounting Treatment:**
- For the purposes of accounting, Entry Tax is treated as an expense or a cost related to bringing goods into a specific location or state. When recording Entry Tax in your books:
- Debit the respective expense account related to Entry Tax (e.g., Entry Tax Expenses).
- Credit the corresponding liability account (Entry Tax Payable) until the tax is paid.

To ensure accuracy and compliance with local regulations, especially regarding the specific treatment of Excise Duty and Customs Duty in Entry Tax calculations, it's advisable to consult with a tax advisor or directly with the Karnataka Commercial Taxes Department. They can provide the most up-to-date information and guidance based on the latest state laws and regulations.

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