Central Sales Tax
Q1. What did CST serve to achieve?
Ans: The main objectives of the CST were to tax commerce between states and avoid double taxation on interstate transactions. The different state governments collected CST that had been collected by the national government.
Q2. What separated CST from other taxes?
Ans: Compared to other taxes, CST solely applied to interstate operations. It was an indirect tax, compared to the Goods and Services Tax (GST) and Value Added Tax (VAT), which were both applied to both intra-state and inter-state operations.
Q3. How was the CST determined?
Ans: A percentage of the cost of the goods sold during interstate transactions was used to determine CST. State governments individually set the CST rates, which differed from one state to the next.
Q4. Who was liable to pay CST?
Ans: In most instances, the seller of goods involved in interstate trade or commerce was liable for paying CST. However, State-by-state variations in the kinds and amounts of transactions resulted in various exemptions and boundaries.
CST Full Form
Full Form of CST: CST stands for Central Sales Tax. A tax charged by the central government on the sale of products during commerce between states or inside the borders of India is referred to as a central sales tax. The Central Sales Tax Act of 1956 regulates it. When goods are sold between states or to entities like the government, municipal governments, or authorized dealers outside the state, CST is applicable. Depending on the type of goods, the CST rate differs and is set by the respective state governments.