In the above matter, it may kindly be noted that following amendments are likely to come into force w.e.f. 1-4-2007.
Gist of Amendments:
Rate of CST for inter-state sales against Form 'C' will be reduced from 4 % to 3 % CST.
Provision for inter-state sales against Form 'D' is to be deleted. Therefore henceforth instead of 'D' form 'C' Form is required to be obtained from Govt. Department. Please ensure that Govt. Department is a registered dealer.
Henceforth on and from 1-4-2007 rate of CST would be as under.
Against `C' Forms
Without `C' Forms
If the goods are tax free or exempted unconditionally
If rate of tax under Gujarat VAT Act is less than 3%
Instead of 10% CST, only rate according to Local VAT Act will be levied
If rate of tax under Gujarat VAT Act is more than 3%
Rate according to Local VAT Act
Due to the above amendment if the local rate of Vat is 4%, then without 'C' Form CST will be levied @ 4% and if the local VAT rate is 12.5% then sales without 'C' Form will be taxed @ 12.5% CST.
Tobacco is removed from the list of declared goods. Now the state can levy tax on tobacco at higher rate. State amendments are awaited. It will be levied @ 12.5%