Sales tax is also known as indirect tax. It is a tax which is charged on the sale of goods. At the point of sale of goods retailer is liable to collect the sales tax and submitted to Government. Law may allow the seller to show the amount of tax differently in the selling price or they can also include in the sale price which is called inclusive of all taxes.
VAT (Value Added Tax) :
VAT is charged at the time of sale of goods in intrastate. When a dealer is selling the goods to other within the state then he is liable to charge the VAT and the same has to be submitted to the state Government within the prescribed time. The rate of tax is different from product to product and state to state
CST (Central Sales Tax) :
CST is charged at the time of sales of goods in interstate. When a dealer is selling the goods to other outside the state then he is liable to charge the CST and same has to be submitted the department within the prescribed time. When a CST sale is made from registered dealer to registered dealer it can be done at low rate of rate against “C” form.