Punjab Vat Guide

The purpose of Punjab Value Added Tax 2005 is to provide for the levy and collection of value added tax and turnover tax on the sales or purchases of goods in the state of Punjab. In this article, we look at the Punjab VAT registration, VAT return filing, VAT rates and administration of VAT rules in Punjab.

Punjab VAT Registration

According to Punjab Value Added Tax Act, 2005 every person, who has been registered upon the application made under this act shall, for so long as his registration is in force, be made liable to pay tax under this Act whether his gross turnover exceeds the taxable quantum or does not. The following persons or entities are required to obtain Punjab VAT registration.

For a Manufacturer, when turnover is in excess of Rs. 1 Lakh
For a Person, running Restaurant or Hotel when turnover is in excess of Rs.5 Lakhs
For a person who is running a bakery, when turnover is in excess of Rs.10 Lakhs
For an Importer of taxable goods for sale or use in manufacturing activities within the State, when turnover is in excess of Rs.1 Lakh
For a person who receives goods on consignment or on a branch transfer basis from within or outside the State of Punjab on which no tax paid related to the Act, when the turnover is in excess of Rs. 1 Lakh
For a person liable to pay purchase tax, when turnover is in excess of Rs 1 Lakh
For a person who wants voluntary registration, when turnover is in excess of Rs.10 Lakhs
For a person dealing in taxable goods, who is registered under the Central Sales Tax Act, 1956 when turnover is Nil
For any other person, when turnover is in excess of Rs.50 Lakhs
For any Person related to TOT Registration, when turnover is in excess of Rs.5 Lakhs

Punjab VAT Return Filing

According to Punjab Value Added Tax Act, 2005, all dealers have to comply with, whether required to file returns on a monthly, quarterly or six monthly basis submitting their returns in an electronic format. Every taxable person can file quarterly self-assessed returns in a Form VAT-15, within a period of 30 days from the expiry date of each quarter along with payment proof made into the suitable Government Treasury.

Punjab VAT Rate

According to Punjab Value Added Tax Act, 2005 the following are the VAT Rates:

Schedule A

There are approximately fifty products and goods that are generally exempted from VAT. They are animal-driven agricultural implements, manually operated agricultural implements, tractor-driven agricultural implements, paper and newsprint, power implements, life saving drugs, kerosene, renewable energy materials, textiles fresh vegetables and fruits, etc. Other commodities that are exempted from VAT are goods exported by Export Oriented Units (EOU), Goods that are exported to other countries, Commodities sold between the SEZ and EOU, and Commodities and goods sold from DTA (Domestic Tariff Area), SEZ (Special Economic Zones) and EOU (Export Oriented Units).

Schedule B

Under this schedule B of Punjab Commercial Tax Act, more than two hundred products are taxable. They are bulk drugs, non-manually operated agricultural implements, sports goods, hospital equipment, kitchen ware, communications equipment, and so on. Intangible goods such as patents, licenses, and copyrights also fall under this schedule. The aforementioned goods are charged a VAT rate of 4%.

Schedule C

Under this schedule, the VAT is levied on Commodities such as silver, gold, and platinum ornaments, noble ornaments and metals, precious stones, and bullion. The aforementioned good are charged a VAT rate of 1%.

Schedule D

Under this schedule D of Punjab Commercial Tax Act, more than one fifty nine products are levied VAT. They are aero planes, arms and ammunition, and other aircrafts, advertising hoardings, cosmetics, tobacco products, and electronic goods, etc. The aforementioned goods are charged a VAT rate of 13.5 %.

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Frequently Asked Questions

Common questions about Punjab VAT Registration, Filing, and Rates Explained.

The purpose of the Punjab Value Added Tax 2005 is to provide for the levy and collection of value added tax and turnover tax on the sales or purchases of goods in the state of Punjab.

According to the Punjab Value Added Tax Act, 2005, various entities such as manufacturers, restaurants, hotels, bakeries, importers, and persons dealing in taxable goods need to obtain Punjab VAT registration if their turnover exceeds certain prescribed limits.

Every taxable person can file quarterly self-assessed returns in Form VAT-15, within a period of 30 days from the expiry date of each quarter along with payment proof made into the suitable Government Treasury.

Yes, Schedule A of the Punjab Value Added Tax Act, 2005 lists approximately fifty products and goods that are generally exempted from VAT, including animal-driven agricultural implements, life-saving drugs, renewable energy materials, and fresh vegetables and fruits.

Under Schedule B of the Punjab Commercial Tax Act, bulk drugs, non-manually operated agricultural implements, sports goods, hospital equipment, and other such products are charged a VAT rate of 4%.

Yes, under Schedule C of the Punjab Commercial Tax Act, silver, gold, platinum ornaments, noble ornaments, precious stones, and bullion are charged a VAT rate of 1%.

Under Schedule D of the Punjab Commercial Tax Act, products such as airplanes, arms and ammunition, advertising hoardings, cosmetics, tobacco products, and electronic goods are charged the highest VAT rate of 13.5%.

Yes, a person who wants voluntary registration can obtain Punjab VAT registration if their turnover is in excess of Rs. 10 Lakhs.

Yes, according to the Punjab Value Added Tax Act, 2005, a person dealing in taxable goods who is registered under the Central Sales Tax Act, 1956 needs to obtain Punjab VAT registration even if their turnover is Nil.

Yes, any person related to TOT Registration needs to obtain Punjab VAT registration if their turnover is in excess of Rs. 5 Lakhs.