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Inter-state VAT |
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My question pertains to inter-state VAT. Whenever I purchase products from Kolkata, I pay VAT in West Bengal, and also in Jamshedpur. In addition I have to pay an entry tax too. In case, I go for CST billing, I pay 2 percent CST plus 4 percent VAT. Why is there double taxation on inter-state transactions?
Jaspal Singh, SparX Tech, Jamshedpur
Suhail Nathani: There are two options to purchase a product viz. on payment of local 4 percent VAT in West Bengal or on payment of 2 percent CST. Purchase on payment of local VAT would result in a loss of the set-off of the entire tax paid resulting in an increase in cost. It would therefore be advisable to purchase on the payment of CST. There is no question of double taxation in form of entry tax and VAT, as the entry tax paid is deducted from the VAT payable.
Suresh Pansari: Jaspal, why do you want to complicate matters when the easiest way out is to buy products by paying CST or still better, purchasing it from a national distributor? Then you will not have to worry about filling up so many forms or paying taxes.
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