Works contract tax
This query is : Resolved
03 March 2010
what is works contract tax and when it is levied ? plz give me details of WCT.
03 March 2010
WCT is a tax on transfer of property involved in excution of works contract.
For example, when a contractor undertakes to construct a building, materials like Bricks, cement, TMT Bar, stone chips, sand etc gets transfered to the contractee.
By a legal fiction, vide amendment to Art. 366 of the constitution, such transfer are treated as deemed sale, and States were given power to impose sales tax(now VAT) on such transfer.
It is a VAT, although popularly termed as WCT.
For example, when a contractor undertakes to construct a building, materials like Bricks, cement, TMT Bar, stone chips, sand etc gets transfered to the contractee.
By a legal fiction, vide amendment to Art. 366 of the constitution, such transfer are treated as deemed sale, and States were given power to impose sales tax(now VAT) on such transfer.
It is a VAT, although popularly termed as WCT.
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