“
Central Excise 2.3 Central Excise Duty is levied by the Central Government under the Central Excise Act, 1944. The levy is on all goods manufactured and produced in India, which are specified in the schedule to the Central Excise Tariff Act subject to certain exemptions. The effective rate may vary from product to product though most goods are subject to excise duty at 10% (without education cess). As manufacturer, credit is allowed on excise duty and countervailing duty paid on inputs and capital goods and the service tax paid on input service. The credit is allowed as a setoff against the excise duty payable on the output. Cross credit utilisation between credit of service tax and excise duty has been enabled w.e.f.10.9.2004. Service tax 2.4 Service tax is levied by the Central Government under Chapter V and Chapter VA of Finance Act, 1994. Service tax is levied on specified services, referred to as taxable services, when rendered by a service provider. Service tax is presently taxed at 10% (without education cess).Ordinarily, service tax is payable by the service provider, except in specified cases. As service provider, credit is allowed on excise duty and countervailing duty paid on inputs and capital goods and the service tax paid on input service. The credit is allowed as a set-off against the service tax payable on taxable services. VAT & CST 2.5 Value Added Tax (VAT) is levied by the State Governments on transfer of property in goods from one person to another, when such transfer is for cash, deferred payment or other valuable consideration. VAT is also payable on certain transactions that are deemed to be sale such as transfer of right to use goods, hire purchase and sale by instalments, works contract and sale of food and drink as a part of rendering of any service. 2.6 Local VAT is payable when goods are sold within the State and Central Sales Tax (CST) is payable when sale occasions the movement of goods 4
”
”