Cst - mobile phones

Rajesh (Mgr) (31 Points)

11 May 2012  


My company is registered in Mumbai and I deal in used mobile phones and buy from end users and sell to end users. Right now I don't pay VAT because my business is small. Next year I will cross the threshold and will need to start paying VAT. My question is how I can minimize the VAT I pay. 
1) My understanding is that since I buy from end-user (a non-registered VAT dealer) I don't get any input credit and so need to pay VAT on the entire sale amount when I sell. Is that correct?
2) Maharashtra has 12.5% VAT for mobiles but states like Karnataka and Haryana have 5% VAT rate. Is there any state with lower than 5% VAT rate?
3) What requirements do I need to fulfill to be able to bill from a lower-VAT state like Karnataka? i.e. if the buyer, seller, and goods is located is Maharashtra, is it possible to bill from Karnataka and thereby pay the 5% Karnataka VAT rate and not the Maharashtra 12.5% VAT rate.
Thank you in advance!