Sales tax is an indirect tax that is imposed by the central or the local government on retail goods and services at the point of sale. Thus, sales tax has to be paid by every dealer on the sale of any commodity, irrespective of the fact that no liability to pay tax on the sale of goods arises under the tax laws of the appropriate state. He is to pay sales tax to the sales tax authority of the state from which the movement of the commodities commences. The tax collected by retailers is passed on to the state.
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