Vat on contracts signed earlier than feb 1 remains 5 fec

A specific question about VAT in India!

Yes, you are correct. According to the Goods and Services Tax (GST) law in India, the VAT rate on contracts signed before February 1, 2017, remains 5% (FEC - Full Excise Duty).

Prior to the introduction of GST, the VAT rate in India was 5% (FEC) for most goods and services. When GST was introduced on July 1, 2017, the VAT rate was replaced by the GST rate, which is a multi-rate tax with rates ranging from 0% to 28%.

However, contracts signed before February 1, 2017, are governed by the pre-GST laws, including the VAT law. Therefore, the VAT rate on such contracts remains 5% (FEC).

It's worth noting that this applies only to contracts signed before February 1, 2017, and not to contracts signed after that date, which are subject to GST rates.