Tamil
Nadu General Sales Tax Act 1959 - Rate of tax clarification
under Section 28-A - Printers who had opted for payment of
tax under Section 3(G) of the TNGST Act,1959 are also entitled
to purchase inputs against Form-XVII.
Availability
of Statutory Forms - Communication by Commissioner of Commercial
Taxes on sufficient availability of Statutory Forms like Form
C and request to communicate delay, if any, in collection
of statutory forms from other states.
The
above notification has been amended retrospectively with effect
from 16/07/2007 by Notification No. G.O. Ms. No. 145 dated
03/08/2007. The effect of the amendment is that Lubricating
Oil and LPG would be liable to VAT at 12.5% with effect from
16/07/2007, except when sold as Industrial Input to manufacturers
under Entry 67 of Part B to Schedule I.
The
Taxation Laws Amendment Act, 2006, amending the CST Act, 1956
and the Additional
Duties of Excise (Goods of Special Importance) Act, 1957 (58
of 1957)Act
comes into effect from 01/04/2007 vide notification No.
1/2007-CST – F.No.34/135/2005-STdated29/03/2007.
Substantial
changesin
the CST Act are
1)
The rate of tax for sale to registered dealers , against
Form C, would be 3% or or at the rate applicable to
the sale or purchase of such goods inside the appropriate
State under the sales tax law of that State, whichever is
lower:
2)
In the case of sale other than to registered dealers,
the rate of tax applicable would be the rate applicable to
the sale or purchase of such goods inside the appropriate
State under the sales tax law of that State
The
important change to note is that, for sales after 01/04/2007,
in the case of goods subject
to tax on sale within the State at 4%, the rate of tax on
inter state sale would only be 4% and not 10%
3)Provision
for sale to Government at concessional rate of tax against
Form D has been deleted. The rate of tax on sale to Government
would now be the rate of tax applicable under the VAT Act.
4)Tobacco
has been removed from the list of declared goods under the
CST Act. TheStates
may therefore levy tax at rate of tax higher than 4%
Disallowance
of Input Tax Credit for Stock Transfer
VAT
Act of most States, specify that a dealer would be eligible
for Input Tax Credit in excess of 4% when goods are stock
transferred. The disallowance of 4% was with reference to
the rate of tax of 4% applicable on inter state sale to registered
dealers against Form C.
Some
of the State VAT Act specifies the disallowance as restricted
to rate of tax applicable on inter state sale to registered
dealers or have specified the disallowance as restricted to
the rate specified in Section 8(1) of the CST Act.
VAT
Acts of Assam and Kerala have linked the rate of tax to Section
8(1) of the CST Act.
With
the reduction of CST rate of tax to 3% on sale to registered
dealers it is expected that the State VAT Acts would be amended
to restrict the disallowance to 3%.
