Difference Between VAT And CST

Under the CST Act, the tax is collected at one stage of purchase or sale of goods. Therefore, the
burden of the full tax bond is borne by only one dealer, either the first or the last dealer.
However, under the VAT system, the tax burden would be shared by all the dealers from first to
last. Then, such tax would be passed upon the final consumers.
Under the CST Act, the tax is levied at a single point. Under the VAT system, the retailers are
not subject to tax except for the retail tax.
Under the CST Act, general and specific exemptions are granted on certain goods while VAT
does not permit such exemptions. Under the CST law, concessional rates are provided on certain
taxes. The VAT regime will do away with such concessions as it would provide the full credit on
the tax that has been paid earlier.
Under VAT law, first, the dealer pays tax on the sale or purchase of goods. The subsequent
dealer pays tax on the portion of the value added upon such goods. Thus, the tax burden is shared
equally by the last dealer. To illustrate the whole procedure of VAT, we give you an example as
follows:
At the first point of sale, the value of goods is Rs.100. The tax on this is 12.5%. Therefore, the
net VAT would be 12.5%. At the second change of sale, the sale value is Rs.120 and the tax
thereon is 15%. The tax that is to be paid at every point is 15%. The input tax is 15%. You will
get a credit for first change in sale of 2.5%-- i.e. 15% -12.5%. Therefore, 2.5% will be the net
rate. At the third change of sale, the sale value is Rs.150 and the tax on this is 18.75%. At the last
stage, the tax paid is 18.75%. The Input Tax is 18.75%. You get a credit for second change in
sale?i.e. 18.75% -15% = 3.75%. Therefore, 3.75% would be the net VAT. This means that VAT
is paid in the last point tax under the sale tax regime.
Question what is difference among VAT, CST and sale tax
Question Submitted By :: Guest
I also faced this Question!! Answer
Rank
Posted By

Re: what is difference among VAT, CST and sale tax

Answer VAT [Value Added TAx] means tax 0 Vedhavyas
# 1 is local tax i.e, within G Kotekar
the state & CST [Central Sales
Tax] Inter state Sales or
Transaction and Sales Tax is the
Tax on Sales it may be VAT
or CST.

42
Ye
Is This Answer s
Correct ? 2 No

Re: what is difference among VAT, CST and sale tax

Answer VAT MEANS INTRA STATE TAX , 0 Bikram
#2 AND CST INTER STATE SALES
TAX , SALES TAX ARE CLOSE NOW
THIS PLACE USE IN VAT

6
Ye
Is This Answer s
Correct ? 13 No

Re: what is difference among VAT, CST and sale tax

Answer vat is value added tax ( it is 0 Narender
# 3 local tax on product sale) & Kumar
cst is a central sale tax (it is
not local tax , basically
it is sale of other then local
state.vat & cst both are
sale tax

Is This Answer 9
Correct ? Ye 0 No
s
 Re: what is difference among VAT, CST and sale tax
Answer Value added tax is Basically 0 Jayashree
#4 ,when goods are sold
locally,or within state only &
CST is ,when goods are sold
out of state. Sale tax is
general term used for all sold
goods.

3
Ye
Is This Answer s
Correct ? 0 No

Re: what is difference among VAT, CST and sale tax

Answer In VAT we can take credit from 0 Ramya
#5 our purchases, but in CST we
cannot take credit from our
purchases.

3
Ye
Is This Answer s
Correct ? 0 No

Re: what is difference among VAT, CST and sale tax

Answer VAT- Vat is a local tax in a 0 Amit Goyal
# 6 state.That percentage is 4,5
and 12.50 %.In local tax we
issue D-1 form aganist 4% sale
or purchase.otherwise 5 or 12.50
%tax will be charge.

CST - Central sale tax is a sale

of outside local city.It
means sale on central area.the
tax is on C form 2 %
otherwise 4 and 12.50 %,It
depends on item.

sale tax- We are saling the

product than we can charge tax
that is sale tax.sale can be
central and local.
 2
Ye
Is This Answer s
Correct ? 0 No

Re: what is difference among VAT, CST and sale tax

Answer IF YOU ARE PURCHASING SOMETHING 0 Abhishek
#7 WITHIN THE STATE. THEN YOU Ranjan
HAVE TO PAY VAT AS A TAX. & YOU
ARE PURCHASING FROM ANOTHER
STATE THEN YOU HAVE TO PAY
CENTRAL SALE TAX.

0
Ye
Is This Answer s
Correct ? 0 No

Other Taxation Interview Questions

Question Asked @ Answers

Is Accounts Payable and Vendor Payable are same ?

1
If yes or no, why ?
What is the rate of CST without any form on
2
Poplpropelene yarn to be sold out of Uttarakhand
if there is no express contract between parties,but
makes no. of payments to a particular party and
those payments exceeds the limits prescribed(i.e 1
20000 or 50000 as the case may be)is tds applicable
for the same?
Can anybody give the rates of TDS for daily 1
purchased things like food,metal,wine,electrical
 item,civil items etc.
What is the Penalty/Interest charges if non-payment
before due date for IT,TDS,ADVANCE
Jakson 2
TAX,VAT,ST,EXCISE DUTY,PT,ST.PF,ESI?very
urgent.
till the discounted bill is paid by acceptor it, remans
1)a contigent liabilities for the acceptor 2)a
contigent liabilities fot the drawer 3)a contigent 1
liabilities for the bank 4)a liabilities for the drawer
chose correct answer with detils.
Pass a entry for the Contract receipts of Rs. 20000
after deduction of mobilization adv 30%, TDS
6
2.244%,Works Contract TDS 2% and retention
money @ 10%
Please expain TDS like return time or % of rate and
1
how to calculte. All Details regarding to TDS.
What is WCT? On Which it is calculated? 9
What is the difference between Advance Tax and
Godrej 13
TDS?
what is GDP Banking 4
With Late
What will be journal entry for TDS deducated from
Payment Of
an freight payment of RS. 15000.00 , applicable 6
Tds Interest
TDS rate is 2.266%
Payable
When private limited company liable to pay service
1
tax???????
WHAT IS MEANIN OF DEPB LICENCE UNDER
1
IMPORT & EXPORT
subscription charges paid to foreign firm, whether
2
TDS is applicable or not? Because amount is huge
what is the difference between CST, VAT, SALES
4
TAX, EXCISE DUTY, CUSTOMS DUTY
if a product arrives to us at mrp price of 205 and vat
1
percentage is 12.5%, how to bill for the customers
if we sent our goods for selling purpose to our
agents outsight the state, is there any need of 1
sending c form to him or form 38
I have the Total amount of 235242. 235242 is
included (ST+ED+SED) 10.30%+ Basic of Sales. 2
what is Basic Value???
What is the rate of TDS for commission?

Question
what is the difference between CST, VAT, SALES TAX, EXCISE
DUTY, CUSTOMS DUTY
Question Submitted By :: Badamsetty I also faced this Question!! Rank Answer Posted By
Re: what is the difference between CST, VAT, SALES TAX, EXCISE DUTY,
CUSTOMS DUTY Answer
#1
CST- Central Sales Tax on the sell of goods within the
states of India
VAT- Value added tax which is local on the sell of goods
within the state itself
Sales tax- Same as VAT,,,,,mostly dominated by VAT
Excise duty- Tax on the production of goods in india by
state gov.
Customs duty- Tax on the goods imported in India

Is This Answer Correct ?

42 Yes 10 No
4
Snehit
Re: what is the difference between CST, VAT, SALES TAX, EXCISE DUTY,
CUSTOMS DUTY Answer
#2
Excise duty is payable on goods manufactured within India
subject to exsiable material.

Is This Answer Correct ?

18 Yes 8 No
0
Prafull

Re: what is the difference between CST, VAT, SALES TAX, EXCISE DUTY,
CUSTOMS DUTY Answer
#3
Excise Duty is applicable only for the Manufacturers.
However the Traders applies Modvet on Goods they sold.

Is This Answer Correct ?

7 Yes 7 No
0
Arun Sajwan
Re: what is the difference between CST, VAT, SALES TAX, EXCISE DUTY,
CUSTOMS DUTY Answer
#4
CST is levied on the INTER STATE sales of goods.

VAT is levied on the INTRA STATE sales of goods. It is

charged on each point of value addition on to the goods on
the value that is added on the goods at that stage and not
on the total price of goods.
SALES TAX is same like VAT except that it is charged at one
point on the total price of goods. Now it has been largely
replaced by VAT.

THE ABOVE THREE ARE CHARGED BY THE STATE GOVTs.

EXCISE is charged on MANUFACTURED goods by CENTRAL GOVT.

CUSTOMS DUTY is charged on goods imported from other

countries.