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Gst and vat

JD ( Business) (352 Points)

20 September 2016

I am just curious, once the GST comes into implementation we will have a GST number . What happens to VAT and CST numbers?

They become useless?

Thanks in advance.

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6 Replies

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (160342 Points)
Replied 20 September 2016

Naturally, it will be replaced

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JD ( Business) (352 Points)
Replied 20 September 2016

Thanks .

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Karan Singla (none) (22 Points)
Replied 28 September 2016

I wanted to know whether the credit for the difference in rate of VAT and GST against the inventory available when the GST becomes applicable will be allowed or not. If yes, then what will be procedure to get the same .

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (160342 Points)
Replied 28 September 2016

Not specified till date. But that may not be the necessity as the GST rate will be more than VAT rate, while input credits under VAT, Service tax etc. as per final return filled will be allowed to carry forward to GST.

Karan Singla (none) (22 Points)
Replied 28 September 2016

But sir , if a person has paid VAT @ 5.5% on purchase of particular goods and after application of gst , when he will make sale for those goods he has to pay tax on higher rate let say 18%on the goods in his stock. Difference between rate is the matter of concern.

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (160342 Points)
Replied 28 September 2016

Let me try to explain with example.

1. You have some goods worth 100 Rs. in stock, on which you have paid VAT of Rs. 5.50.

2. After implementation of GST, if you sale that say at 10 Rs. profit @ Rs. 110/-. Here you will charge 18% GST to your customer and collect Rs. 110+19.80= 129.80. Where is the question of you paying extra tax?

3. Now you will pay Rs. 19.80- 5.50 Input cr. = 14.30 as GST collected to treasury. So, whatever may be the difference in tax rates in VAT or GST will not affect you, but to final consumer.

Now put your exact doubt, if not solved, as in above example.

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