CST Rate

[rajesh marwaha]

Has the rate of CST been reduced to 2% w.e.f. 01.04.2007 ?

[Guest]

Though the CST rate is proposed to be reduced to 2% in the Union Budget w.e.f. 1.4.07, as specified in the Budget speech, the relevant notification reducing the rate has not been issued so far, pending agreement on compensation issue among Centre and States. Thus, the reduced rate will be effective only on notification of the reduction in rate.

AI Summary

CST rate reduction will be effective only upon formal notification, pending agreement on compensation between centre and states. Although a reduced CST rate was proposed in the Union Budget with an intended commencement date, the statutory notification implementing that reduced rate has not been issued; the reduction remains inoperative until the notification is issued, a delay caused by unresolved compensation arrangements between the Centre and the States.