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Report No. 61

2.19. The question of manner of levy.-

If, then, the second alternative1 is to be adopted, the next broad question that arises is, whether the tax on the inter-State consignments should be leviable in the same manner as the present Central sales tax is levied, or whether any other device should be adopted in that behalf. One possible device could be this-the State to which goods are consigned from another State (otherwise than by way of sale) may be empowered to levy a higher rate of tax on such goods when sold internally with in the consignee State, with a provision, for granting rebate in respect of such inter-State sales tax as has been actually levied on those goods.

Though this device may avoid an amendment of the scope of 'sale' in the Central Sales Tax Act (which will be necessary under the other alternative), it will also involve some other amendments. Moreover, the consignor State would not get any additional revenue if this device is adopted, at least in cases where the consignee State does not avail itself of the power to levy higher tax. On the other hand, if the present scheme given in the Central Sales Tax Act is extended to consignments not amounting to sale, there would be symmetry, and also a certain amount of smoothness in working, because the experience gained in the working of the present Act would continue to be valuable and useful for the collection and realisation of the extended tax also.

1. Para. 2.18, supra.

Certain Problems connected with Powers of the States to Levy a Tax on the Sale of Goods and with the Central Sales Tax Act, 1956 Back

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