Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
Popular Search: ACCOUNTING STANDARDS :: VAT RATES :: ACCOUNTING STANDARD :: TDS :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: form 3cd :: empanelment :: list of goods taxed at 4% :: cpt :: VAT Audit :: ARTICLES ON INPUT TAX CREDIT IN VAT :: Central Excise rule to resale the machines to a new company :: due date for vat payment :: TAX RATES - GOODS TAXABLE @ 4% :: articles on VAT and GST in India
Sales Tax »
 Supreme Court stays levy of penalty on sales tax paid by Tata Sons
 CCI dismisses complaint against Maharashtra sales tax dept
 Political storm in Japan over sales tax relief plan
 10 Major Cities With the Highest Sales Tax
  Auction for Sale (Re-Issue) of Government Stocks
  Auction for Sale (Re-Issue) of Government Stocks
 Auction for Sale (Re-Issue) of Government Stocks
 Goods and Sales Tax set to face Rajya Sabha test
 CBDT signs two advance pricing pacts with US firms
 State to exempt sugar from CST, VAT
 Top 10 highest tax paying countries in 2015

Introduction ( Central Sales Taxes )
September, 26th 2011

Certain amendments were made in the Constitution through the Constitution (Sixth Amendment) Act, 1956 whereby-

Taxes on sales or purchases of goods in the course of inter-State trade or commerce were brought expressly within the purview of the legislative jurisdiction of Parliament;

Restrictions could be imposed on the powers of State legislatures with respect to the levy of taxes on the sale or purchase of goods within the State where the goods are of special importance in inter-State trade or commerce.

This amendment also authorized Parliament to formulate principles for determining when a sale or purchase takes place in the course of inter-State trade or commerce or in the course of export or import or outside a State.

Accordingly the Central Sales Tax (CST) Act, 1956 was enacted which came into force on 05.01.1957. Originally, the rate of CST was 1%, which was increased first to 2%, then to 3% and w.e.f. 1st July, 1975 to 4%. The CST Act, 1956 Act provides for declaration of certain goods to be of special importance in inter-State trade or commerce and lay down restrictions on the taxation of such items. The entire revenue accruing under levy of CST is collected and kept by the State in which the sale originates. The Act excludes taxation of imports and exports.

CST being an origin based tax, is inconsistent with Value Added Tax which is a destination based tax with inherent input tax credit refund. An amendment to the Central Sales Tax Act to provide for reduction of the rate of Central Sales Tax for inter-State sales between registered dealers from 4% to 3% w.e.f. 1st April, 2007 was effected in. Through this amendment, facility of inter-State purchases by Government Departments at concessional CST rate, against Form-D has been withdrawn. After this amendment, the rate of CST on inter-State sales to Government will be same as VAT/ State sales tax rate.

Central Sales Tax rate has been further reduced from 3% to 2% with effect from 1st June, 2008. Reduction of CST rate first from 4% to 3% & then from 3% to 2% has been done as a precursor to the introduction of Goods & Services Tax (GST), as CST would be inconsistent with the concept & design of GST.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2015 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Company Overview

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions