Delivery assistance charges

This query is : Resolved

V.PUSHPA (Querist)
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03 November 2011 Dear all,

Whether Delivery assistence charges to be included with value for calculating VAT / CST in relation to Furnace Oil / HSD invoice.
If yes under what section/para/notification/circular it is included for VAT/CST. Kindly guide me.

Thank U

U S Sharma

U S Sharma (Expert)
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03 November 2011 there is no term as delivery assistance charge, all such charges are included in delivery charges.

V.PUSHPA

V.PUSHPA (Querist)
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04 November 2011 OK sir, whether delivery charges will be included for VAT / CST calculation ?

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Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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20 July 2024 In the context of VAT (Value Added Tax) and CST (Central Sales Tax), the treatment of delivery charges depends on the specific tax laws of each state in India. Here are the general guidelines:

### VAT (Value Added Tax):

1. **Intra-state Transactions:**
- **Delivery Charges Inclusion:** In many states, delivery charges are considered part of the taxable value of the goods. Therefore, VAT is typically calculated on the total consideration paid by the buyer, including the cost of goods and any charges for delivery or freight.

2. **Inter-state Transactions:**
- **CST Application:** For transactions between states, Central Sales Tax (CST) is applicable until the implementation of GST (Goods and Services Tax).
- **Taxable Event:** CST is levied on the sale of goods during inter-state trade. The charges associated with delivery are generally not separately taxed under CST, but they may be considered as part of the overall transaction value.

### Goods and Services Tax (GST):

Since the implementation of GST, which replaced VAT and CST, the treatment of delivery charges is as follows:

1. **GST Regime:**
- **Intra-state and Inter-state Transactions:** Under GST, delivery charges are treated as part of the taxable value of goods or services. GST is applied on the total consideration paid, which includes the value of goods/services plus any incidental charges like delivery charges.

### Conclusion:

- **VAT and CST:** In most states, delivery charges are included in the taxable value for VAT calculation purposes, whether it's intra-state or inter-state transactions.
- **GST:** Under GST, which is the current tax regime, delivery charges are considered part of the transaction value and are subject to GST.

It's essential to consult the specific state VAT/CST laws or GST provisions applicable in your case to ensure compliance with tax regulations. Regulations may vary slightly between states, so it's advisable to seek guidance from a tax professional or refer to the relevant state-specific tax rules.