First reform of Indian taxation system:

The first reform of Indian taxation system happened when Value Added Tax (VAT) was
introduced into the Indian taxation system from 1 April 2005. The existing general sales
tax laws were replaced with the Value Added Tax Act (2005) and associated VAT rules.
But still Central Sales Tax (CST), Central Excise Duty, Additional Customs Duty (CVD),
Service Tax, Octroi of Local Self Governing Bodies (eg; Municipal Corporation), Luxury
Tax, Entertainment Tax, etc were not included under the umbrella of the VAT system.

Second reform of Indian taxation system:

Second reform of Indian taxation system proposed with the name Goods and Service Tax
(GST) have a broader umbrella to cover all the above mentioned taxes. It can be called as
second generation VAT system in India because both are based on input tax
credit system. The second generation VAT system merged Luxury Tax, Entertainment
Tax, etc with existing VAT (first generation VAT) and rename it as State Goods and
Service Tax (SGST). Moreover that Central Sales Tax (CST), Central Excise Duty,
Additional Customs Duty (CVD), Service Tax, etc are incorporated into the VAT system
with a single name as Central Goods and Service Tax (CGST). The CGST remain
same irrespective of intra-state or inter-state trade would be credited to the Central Govt
Revenue.

Inter state trade:

Most important draw back of the first generation VAT system in India was its
inefficiency in handling online markets and inter state trade. Central Sales Tax
refers to the tax levied on sales generated during inter-state trade and commerce in a
country was not incorporated to the first generation VAT system. The new Integrated
Goods and Service Tax (IGST) levied would be based on destination principle.
Therefore in the case of inter-state trade the SGST gets transferred to importing state
while Central Govt. collect an additional tax (initially for few years) not exceeding one
percent and assign to the states where the supply originates.

Services Value :

The input tax credits for a trader/manufacturer under the first generation VAT system
includes only the VAT paid for row materials. But the major advantage of the GST
system is that a trader/manufacturer can claim the input tax credits (already paid for
goods and services) like transportation, room rent, manufacturing etc, which was not
possible in the first generation VAT system. This advantage arise due to bringing Service
Taxes, Central Excise Duty, etc. under the VAT umbrella in GST system.
First understand what GST,CST,VAT is?

VAT::A value-added tax (VAT) is a type of consumption tax that is placed on a product
whenever value is added at a stage of production and at final sale.The amount of value-
added tax that the user pays is the cost of the product, less any of the costs of materials
used in the product that have already been taxed.

for more clear understanding with example check my answer on VAT...(Anant Chauhan's
answer to What is a vat?)

CST::Central sales tax(CST) is a tax on sales of goods levied by the central govt of
India.CST is applicable only in case of inter-state sales and not on sales made within the
state or inport/export of sales.

Inter-state sale is when a sale or purchase constitute movement of good from one state to
another,accordingly,consignments to agents or transfer of goods to branch or other
offices is not a sale as per the CST Act.

GST::GST or the Goods and Services Tax is an indirect tax that brings together most of
the taxes that are imposed on all goods and services (except a few) under a single banner.
This is in contrast to the current system, where taxes are levied separately on goods and
services. The GST, however, is a comprehensive form of tax based on a uniform rate of
tax for both goods and services. However, the GST is payable only at the final point of
consumption.

NOW,

HOW GST DIFFER FROM OTHERS---

1>>GST, or Goods and Services Tax, will subsume central indirect taxes like excise duty,
countervailing duty and service tax, as also state levies like value added tax,entry tax,
luxury tax.

2>>The final consumer will bear only the GST charged by the last dealer in the supply
chain, with set-off benefits at all the previous stages.

3>>As a measure of support for the states, petroleum products, alcohol for human
consumption and tobacco have been kept out of the purview of the GST.

4>>It will have two components - Central GST levied by the Center and State GST levied
by the states.

5>>However, only the Center may levy and collect GST on supplies in the course of
inter-state trade or commerce. The tax collected would be divided between the Center
and the states in a manner to be provided by parliament, on the recommendations of the
GST Council.
Hi,
How we can assign to one CST% condition against two different rates for C Form / Without C
Form for same Plant/Vendor/Material.
My scenario is, we have purchased the Material for one plant from Vendor, but Vendor has given
the material against C Form or Without C Form not fixed.
We have used to Plant/Material/Vendor Key combination for updating CST (JVCS) 2% condition
through FV11. And created two PO for C Form 2% & second 5% Without C Form but it is
showing 2% in both PO as per maintained in condition.
When we have received the material against without C Form 5%, changed in CST (JVCS)
condition 5% and do the MIGO and same think do for against C Form.
How to resolve this type problem without changing?
But it is possible in SD their maintaining Price Group; same is it possible in MM.

1 .How we can assign to one CST% condition against two different rates for C Form / Without C
Form for same Plant/Vendor/Material.
As suggested by the Pankaj you need to create 2 tax code i.e. one with C form & other as
Without C form having appropriate Percentage maintained in the condition record ( FV11 )
My scenario is, we have purchased the Material for one plant from Vendor, but Vendor has given
the material against C Form or Without C Form not fixed.
We have used to Plant/Material/Vendor Key combination for updating CST (JVCS) 2% condition
through FV11. And created two PO for C Form 2% & second 5% Without C Form but it is
showing 2% in both PO as per maintained in condition.
As you may have maintained single tax code with the 2% condition record so same %
flows in both PO , Use 2 sperate tax code it will resolve the issue.

The issue is solved, I have done the follow steps:-

1) Created the new condition tables (key combination) Plant/Vendor/Tax Code/Material &
Plant/Vendor/Tax Code/Material Group (Service) & Maintained in Access Sequences.
2) Created only one condition type (CST) for both form, Cform /Without C form and maintained
access sequence.
3) Created Two tax code (S1 & S2)
4) Maintained the rates against tax code wise in FV11, S1 for Cform and S2 for Without c form.
While creating the PO and select Tax code (S1 & S2), system is picking the rate as per
respectively tax code wise.