12 November 2011
Yes you can setoff CST libility with input vat credit.
State Value Added Tax. The discussion regarding the VAT and the implementation which is being planned is only confined to the State. There is no proposed Central VAT at present in the time frame of 1.4.2003. All the States are drafting their separate Value Added Tax Act and as per the present position, every States will have a separate VAT Act with different provision not corresponding with each other. It can be stated that the proposed VAT Act is the primary stage of VAT. It is proposed that there would be Two tax rate slabs on which tax would be levied. The first one would be 4% and would covered all essential items. The second one is 10% and all luxury items would be covered. In addition special rate slabs are also proposed which are 1% for bullion and jewellery, 20% for Non Essential Goods and exemption to certain goods like agricultural produce etc. Petroleum products are not included in VAT rates. Separate rate would be notified for them. Set off. ( Input Credit ): At present the set off would be available on the goods locally purchased within the State only. No set off would be available to the goods purchased in the course of inter state trade and commerce. It will be necessary to produce the tax invoice to claim set off. The tax should have been charged in the invoice. Exempted Goods: Some goods would be declared as exempted by the State Government under the proposed VAT Act. However the present view as per guide lines issued by the State Government are that no set off would be allowed on the exempted goods. It means that the tax suffered on the raw material for manufacture of exempted goods would not be refunded
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