Become a Govt. Certified GST Practitioner in just 60 hrs. Register Now!

Taxation

Nishan Thakkar (Student) (68 Points)

29 April 2011

Hello frnds,

I had a question in mind that do government companies and other institutions run by the various union and state government need to pay various taxes such as IT, ST, VAT, etc????

Reply
Follow
Share

13 Replies

(Guest)

yes

1 Like

Upgrade to CAclubindia Pro. Subscribe Now!

Nayan Das (ACCOUNTS MANAGER) (981 Points)
Replied 29 April 2011

YES, government companies and other institutions run by the various union and state government need to pay various taxes such as IT, ST, VAT, etc

1 Like

Harpreet (* * * * * *) (1670 Points)
Replied 29 April 2011

agreed with above two replies.

1 Like

pinky prajapati (practicing CA) (62 Points)
Replied 29 April 2011

yes govt.cos.are also required to pay taxes.

1 Like

Nishan Thakkar (Student) (68 Points)
Replied 29 April 2011

thank you very much.

bt can u elbrate....i m confused that what is the reason for so because as it the government itself funds such bodies so whats the point of collecting taxes from them.

Upgrade to CAclubindia Pro. Subscribe Now!

(Guest)

the main reason could be to find the correct profitability of such companies after considering all the taxes

(Guest)

if government manufacturing companies did not con sider indirect taxes levied than how can they know the correct cost of product and how can they find the correct sale value to be charged?

1 Like

Nishan Thakkar (Student) (68 Points)
Replied 29 April 2011

thanks a lot... :-)

CA. ANKUR JAIN (CA.....) (2800 Points)
Replied 29 April 2011

@ Nishan...

Govtt companies are also required to pay taxes because

both (these companies and tax department) are different functions and Govtt. have to apply the money collected through taxes on yearly basis as allocated in union budget.....

(its just like a DTC bus when it jumped a red light pays penalty as challan then the said challan money is tfd in the pocket of another govtt department..)

Mayur Arora (CA Final) (295 Points)
Replied 29 April 2011

Yes, Govt. companies and other department run by various government have to pay various taxes to the governement.

Upgrade to CAclubindia Pro. Subscribe Now!

Prasad (Sr. Manager) (617 Points)
Replied 29 April 2011

yes all govt companies pay taxes, if you are confused by Govt Dept, they don't have any commercial activities, hence they don't pay taxes

Pavan Bharadwaj (Practicing Chartered Accountant) (353 Points)
Replied 30 April 2011

Yes Govt. Companies are also required to pay tax.

Rakesh Rao (CA Final Student) (408 Points)
Replied 30 April 2011

Govt. cos. are set up for various reasons:

One of them is to give competition to private players and avoid monopoly or cartels. Eg. If private airlines are charging exorbitant prices (during peak season), then Air India can compete with the private airlines by charging low price and maintaining a very reasonable margin; this might discourage the private airlines from charging high prices and maintain a healthy competition by bringing the prices to the normal levels thereby benefiting the consumers.

But since a competition should be fair play, the rules should be the same, irrespective of the company being govt. or pvt. Air India should not be able to charge lower than than the pvt. airlines only because they are getting tax reliefs!

It should be a very healthy competition and it is correct that the rules (taxes) apply equally to govt. as well as pvt. cos.