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Subscription products/antivirus

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(Querist)
22 February 2012 Please let me know how the dual tax calculation is done on Antivirus/Subscription products.
For eg- Let X be the value of antivirus A, then tax calcualtion will be-
1. Service tax@10.3% x X=Y
VAT/CST@5% x X =Z
Total value of A=X+Y+Z

OR

2.Service tax@10.3% x X=Y (let X+Y=W)
VAT/CST@5% x W =Z
Total value of A= W+Z

Please tell me which option is correct as per govt. rule.

Thank You.
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Krishna Mohan

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Krishna Mohan (Expert)
23 February 2012 Mr.Bose, please remember that MRP is inclusive of all taxes. SO, your second option is correct.
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Subhrajit Bose

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Subhrajit Bose (Querist)
23 February 2012 In both the option MRP is inclusive of all taxes. Please explain if both the taxes needs to be calculated seperately on the base value or VAT will be charged on the amount coming after adding service tax on base value.

thank you
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anurag

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anurag (Expert)
26 February 2012 There is no specific rule for the charging procedure. however the industry is following the second method.
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