Karnataka Increase in VAT rate

The Karnataka Value Added Tax (Second Amendment) Bill, 2012  has been passed in the Assembly to give effect to increase in the rate of VAT charged under the Karnataka Value Added Tax Act, 2003.  As per the said amendment and Notifications issued, with effect from 01 August 2012, the rate of VAT on goods chargeable at the rate of :

·         five percent has been increased to five and one half percent, and

·         fourteen percent has been increased to fourteen and one half percent

The above rates changes are also applicable to works contracts listed down in the sixth schedule appended to the KVAT Act.