VAT and CST

[former_member681145]

Hi experts,

1.Can you tell me wt are the core differernce b/w VAT and CST?

2.What are the rates having present?

3.Can we able to use cenvat utilsation with VAT and CST ?

Regards

Ishikesh

[former_member550050 · Accepted solution]

Hi

1.Can you tell me wt are the core differernce b/w VAT and CST?

VAT is value added tax and CST is central sales tax

VAT is applied to transactions happening within the state

CST is applied to transactions happening from state to state

Say a dealer in Tamilnadu or a plant in Tamilnadu if sends material to customers withinin tamilnadu they charge VAT

Say a dealer in Tamilnadu or a plant in Tamilnadu if sends material to customers outside tamilnadu and to any state it will charge CST

Transactions within state VAT and outside the state CST differentiates both the ---core difference

Another difference is say 1 dealer if he buys a product from outside state he will pay CST and inturn if he sells the product to any customer within the state he cannot charge CST and will charge only VAT which we will pay to govt

say 1 dealer if he buys a product from within the state he will be charged VAT and inturn if he sells the product to any customer he will charge that VAT amount

So VAT amount is recoverable

But CST is not recoverable

2.What are the rates having present?

This depends on different product range varies from product to product

Before coming to SAP in my domain 3 years back our dealers in tamilnadu were charged CST 3% from jan 2007 and VAT was 4% for medical equipments but the rate was not the same for some of the drugs at that time itself

May be someother friend can throw more light on all the three qns you asked

Regards

Raja

[former_member383560]

Hi

VAT a multi point taxation

at present rates are 1% for gold,silver and bullion, 4% for essential commodities,and 12.5 % for remaining goods covers almost all the goods, every value addition tax will be levied. input tax credit available to the VAT registered buyer and seller, this done by 3 methods like ADDITION method, subtraction method and composite method it differs with each state.

CST is single point taxation.

the buyer can avoid extra tax by taking respective forms like C forms for regular dealer, F forms for consignment sale, H form for export sale.

With Regards

baalakrushnan.da