CENTRAL SALES TAX (CST)

CENTRAL SALES TAX (CST)Central Sales Tax is a tax on sales of goods levied by the central government of India. It is applicable only in the case of inter state sales made within the state or import/export of salesInterstate sale is when a sale or purchase constitutes movement of goods from one state to another Currently the rate of CST is 2%For CST, start of journey and movement of goods should end in different state

CST NormsMODVAT credit can be used to pay CST but not CENVAT creditThere are 8 forms in CSTC form :To be signed by the consigneeC form goes from buyer to sellerFrom buyer to seller, E form goes initially and then in subsequent sale more than one form can be usedCST is applicable only in the countryHigh sea sales : Sales in the course of imports and comes under section 5 of CST act

FEATURES OF CST It extends to the whole of India Every dealer who makes an inter-state sale must be a registered dealer and a certificate of registration has to be displayed at all places of his business. There is no exemption limit of turnover for the levy of central sales tax. Under this act, the goods have been classified as: - Declared goods or goods of special importance in inter-state trade or commerce and - Other goods. The rates of tax on declared goods are lower as compared to the rate of tax on goods in the second category. The tax is levied under this act by the Central Government but, it is Collected by that state government from where the goods were sold. In case of union Territories the tax collected is deposited in the consolidated fund of India. The rules regarding submission of returns, payment of tax, appeals etc. are not given in the act. For this purpose, the rules followed by a state in respect of its own sales tax law shall be followed for purpose of this act also