Value Added Tax or VAT was earlier required to be paid by the producers of certain goods and services in India. It was, at a later stage, replaced by the Goods and Services Tax (GST) which became the uniform tax regime which is now operable!
Overview of VAT in Andhra Pradesh
Andhra Pradesh has long been considered a major centre for trade and commerce in the country, occupying a key position in medieval times. Today, with the splitting up of erstwhile Andhra Pradesh into AP and Telangana, one might think that the state has lost a huge chunk of resources. Rebuilding a new Andhra Pradesh is vital for the country, with Value Added Taxes forming an integral component of the earnings of the state. The Commercial Tax Department of AP is in charge of levying and collecting tax in the state, with the Andhra Pradesh VAT Act of 2005 forming the basis for such collection.
Andhra Pradesh VAT Rates
VAT rates in Andhra Pradesh vary according to the product being traded, with different Schedules of the AP VAT Act containing different rates. The basic premise of the VAT Act is to ensure that basic commodities do not attract any VAT, thereby keeping the needs of the general population in mind. Commodities like books, manual agricultural instruments, curd, maize, fresh fruits and vegetables, meat, plantain leaves, etc. are exempted from VAT under Schedule I of the Act. Close to a 100 items are mentioned under this Schedule.
Articles mentioned under Schedule III, IV and V are entitled for VAT, ranging from 4% to 70% in some cases. Commodities under Schedule III attract a VAT of 1%, with some of the major items under this category being jewellery, precious stones, precious stones and bullion.
Goods under Schedule IV of the ACT are charged a VAT of 4%, with some of the popular items in this list being automated agricultural instruments, SIM cards, patents, beedi leaves, coffee, pesticides, ice, microphones, umbrellas, etc., with over 125 commodities included under this schedule.
Commodities under Schedule VI attract the highest VAT, ranging from 22.5% to 70%. Some of the items in this list are liquor, which has to pay 70% VAT, petrol and aviation fuel which pay 33%, diesel which pays 22.5% and tobacco which pays 25% VAT. The high VAT on these products has been commissioned keeping in mind the overall health and wellbeing of the environment and the people of the state.
All other items in the state which are not mentioned in the above schedules need to pay a VAT of 12.5% under Schedule V.
Andhra Pradesh VAT Registration
Under the provisions of the Andhra Pradesh VAT Act of 2005, every individual indulging in trade with an annual taxable turnover of Rs 40 lakhs and above should register himself/herself. They will be registered as a VAT dealer and will be required to pay VAT on their business deals. Similarly, dealers and intermediaries who indulge in trade on behalf of others are also expected to get themselves registered, regardless of their annual turnover being under Rs 40 lakhs. Every registered individual will be provided a General Registration Number (GRN) and a Taxpayer Identification Number (TIN) to assist them in the entire VAT process.
Andhra Pradesh VAT Forms
Forms are integral to the implementation of any rule in the country, and the Andhra Pradesh VAT Act has a provision for multiple forms, each designed for a particular task. There are over 30 individual forms available, each one to used only for its intended purpose. Some of the most important ones are VAT 100 for registration, VAT 121 to cancel an existing VAT registration, VAT 200 for monthly VAT returns, Form 501A for TDS, Form 510 for VAT refunds and Form 525 for stock registration. All these forms can be downloaded from the official website of the Andhra Pradesh Commercial Tax Department.
AP VAT Return e-Filing and Payment
With the internet opening a new path to pay and file taxes, more and more state governments have migrated to the online platform to benefit normal taxpayers. The Andhra Pradesh Government has also provided a provision to complete all formalities associated with VAT online, through their official website. Registered individuals can log on to the website using their credentials and fill out the requisite forms to e-file their VAT return at their own convenience, thereby saving time and effort of manually doing this. The form should contain details about the business entity in question and one should ensure that the details entered are accurate and up to date.
The same website can be used to make VAT payments, with a registered individual expected to use his TIN/GRN credentials to complete payment. E-payment of VAT can be completed only through certain specific branches, the list of which will be mentioned while making a payment.
FAQ's on AP VAT
- Who imposes and collects VAT in Andhra Pradesh?
VAT in Andhra Pradesh is levied and collected by the Department of Commercial Taxes of AP.
- What happens if a dealer/trader fails to register a business on time?
In the event of an individual failing to register his/her business, a fine of Rs 5,000 will be imposed after the due date. The penal amount varies according to the business in question.
- Are unregistered dealers who are not eligible for VAT expected to pay any tax?
Yes, such unregistered dealers need to pay 1% tax on their total taxable turnover.
- How can one claim a refund on the VAT paid?
Individuals eligible for a refund can claim it by filling Form 510, 510A or 510B (as per the need) and submit it to the relevant authorities.