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Vat in goa

abanerji (81 Points)

15 June 2013

In Goa, is there any VAT applicable on the builder when flat is being sold by them?

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7 Replies

MJ Krishnamurthy (ACCT(Retd)) (7197 Points)
Replied 15 June 2013

Yes it is applicable,If he enters into an agreement for construction and sale and takes advances,such cases will be treated as works contract and VAT will be applicable..If After completing the construction a sale is made it is not taken as works contract and no taxes are applicable.........mjk

abanerji (81 Points)
Replied 15 June 2013

Originally posted by : MJ Krishnamurthy
	Yes it is applicable,If he enters into an agreement for construction and sale and takes advances,such cases will be treated as works contract and VAT will be applicable..If After completing the construction a sale is made it is not taken as works contract and no taxes are applicable.........mjk

Thank you for the response.

I quote from the Goa budget speech of this year : "25. Sir, I propose to levy a tax on consideration received or receivable by the builder or developer by way of agreement to sale the flats or housing
project or dwelling units or row houses and the like, which are under construction or development. However flats or dwelling units whose agreement value is less than ` 10 lakhs will be exempted. If the value is between ` 10 lakhs to ` 100 lakhs, than the tax will levied at 1% of the agreement value. In cases, where the value exceeds ` 100 lakhs, the tax will be levied at 2% of the agreement value."

This appeared under the VAT proposals.

My query : whether the new proposals (as above) have been enacted, and as VAT, or some other levy? Also, if this is a new tax from this year, does what you mentioned in your response refer to this new tax, or existing VAT Act already had this works contract tax provision?

In the latter case, does it mean that there is a works contract tax plus a new levy of 1% / 2% additional now?

MJ Krishnamurthy (ACCT(Retd)) (7197 Points)
Replied 17 June 2013

No this is not new levy. This is introduced in the place of the existing rates in the Act. Please read Circular No2 issued by the CommissionCommercial Taxes Goa for all deatais. The budget proposals are enacted in the form of a circular. Visit www.goacomtax.gov.nic.in -click rules...circulars and lastly circular 2........mjk

abanerji (81 Points)
Replied 17 June 2013

Thank you again, for the information.

However, the link provided by you does not lead to a live webpage. Please see the attached screenshot of the page I found. However, there are no circulars under Rules or Notifications.

Could you please advise what were the existing rates of works contract?

Attached File : 6953 1188592 goacomtax.zip downloaded: 362 times

Mohan (Accounts Officer) (35 Points)
Replied 10 October 2014

Dear Mr.M J Krishnamurthy, We are registered under KVAT for Works Contact Tax, our line of activity is Fabrication & Erection of structures. Request you to kindly advice the ratio for rate of VAT & Service Tax to be charges.