Rahul Rai
watch_later 3 years, 2 months ago
What will be the rate of tax on silk items?
At what percentage tax should be paid on:
Raw silk, Silk cocoon and Silk waste are exempted from tax.
Other silk items are taxed at 5%, with full Input tax credit, however refund of excess ITC is not available.
Exempted from tax:
1. Silkworm laying, cocoon [5001]
2. Raw silk [5002]
3. Silk waste [5003]
Taxed at 5% with full ITC (No refund):
1. Silk yarn [5004, 5005, 5006]
2. Woven fabrics of silk or silk waste [5007] [With no refund of ITC accumulation]
From the rates announced so for we can understood that all silk fabrics are taxable including silk sarees manufactured through handloom, which are at present exempted from both VAT and Central Excise. Whatever rates announced are general, however separate Notification may be issued in future to make Silk Sarees made through handloom to exempt.
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