Should i pay extra tax while purchasing goods on bills in Inida?

Posted on September 14, 2008 by Mukesh Goel

After implementation of  VAT in india retailers are making extra money for selling goods on bills.
Suppose i bought a branded ceiling fan in Delhi and retailer have quoted a price Rs.1200 nothing else but as soon i asked for a bill he told me to pay  12.5% VAT extra on Rs.1200.
In VAT system retailer purchase goods after paying tax to the manufacturer it means whatever tax he has paid to the manufacturer is already included in his cost and that should not affect by taking bill or not.
Only VAT on retailer’s markup is to be added if i take bill from him not full tax on whole amount. In this way retailer are making fool to the consumers. Further what they do, they sell the bills to a seprate person and earn extra money by selling bills without goods.
By this excercise they are evading income tax as well as VAT and cosumers are suffering. So please always negotiate for including VAT pricae and ask for bill.

www.mukeshraj.com

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  • Johnson Varghese

    Dear Mr. Mukesh,
    Was this article posted by you or by somebody else. if somebody else, then can you give your comments on this?

    Nice Thought – But isnt it also possible that Rs.1200 for the ceiling fan does not include the vat amount paid by the retailer. What if this selling price is only his cost price+profit ?

  • Rajkumar

    You are right, Johnson. There are possibilities that Rs.1200 for the ceiling fan does not include the vat amount paid by the retailer. But, buyer has to demand for the bill from the retailer, else, there are possibilities that retailers buy products from unregistered manufacturers/dealers & sell them without charging VAT. Totally, it is the moral responsibility of any buyer to ask for bill when he buys products, thereby all players in the market are accountable & helping each other in reducing illegal business.