Sales Tax

• Sales tax is an indirect tax as the consumer pays it to the government through the shopkeepers.
• Sales tax is levied by the state governments. The rates are different for different items, and are usually changed at the time of annual budgets. Different states may have different rates of sales tax. For example, a refrigerator may cost more in Maharashtra than in Madhya Pradesh because sales tax is higher in Maharashtra.
• Sometimes Central Sales Tax (CST) may also be levied on a item.
• Total amount paid = quoted price (or list price) +sale tax.
• Sale tax is calculated on quoted price (also called list price or basic price).

Exercise

1. Shama buys garments worth Rs 2500. If the sales tax is charged at the rate of 6% on garments, what is the total amount paid by Shama?
2. The list price of a television is Rs 13500. If the sales tax is chargeable at the rate of 8%, find the amount the buyer has to pay for it. If an adjoining state charges only 6% sales tax on T.V., what would the total price be?
3. Mona buys the following goods from a departmental store:
      Cosmetics worth Rs 345;
      Medicines worth Rs 228;
      Stationery worth Rs 170;
      Bakery products worth Rs 93;
   If the sales tax is chargeable at the rate of 10% on cosmetics, 7% on medicines, 5% on stationery, and bakery products are exempted from sales tax, find the total amount to be paid by Mona.
4. Harshad purchased a car which was quoted at Rs 270000. The shopkeeper charged sales tax at the rate of 10%. Harshad wanted to take the car outside the state, so the shopkeeper charged 2% extra as central sales tax. Find the total amount paid by Harshad.
5. Sumit paid Rs 30 as sales tax on a pair of shoes worth Rs 500. Find the rate of sales tax.
6. I paid Rs 52·20 as sales tax on a watch worth Rs 1350. Find the rate of sales tax on watches.
7. Petrol (per litre) costs Rs 1·50 higher in Maharashtra than in Madhya Pradesh. Given that rate of sale tax on petrol in Maharashtra is 6% higher, find the basic price of petrol.
8. A washing machine is available for Rs 13440 inclusive of sales tax. If the original cost of washing machine is Rs 12000, find the rate of sales tax.
9. The price of a computer inclusive of sales tax is Rs 52000. If the rate of sales tax is 4%, find the list price of the computer.
10. Namita purchased an audio player for Rs 22000 (inclusive of 10% sales tax) and ten C.D.s for Rs 2100 (inclusive of 5% sales tax). Find the basic price of audio player and C.D.s together.

Answers

1. Rs 2650        2. Rs 14580, Rs 14310    3. Rs 894·96
4. Rs 302400    5. 6%           6. 4%          7. Rs 25
8. 12%              9. Rs 50000                    10. Rs 22000