What is VAT?
"> What is VAT?
"> What is VAT?

What Is Vat?

What is VAT?
Posted 1 year ago  |    0  | 
Taxation & Duty
Taxation & Duty

1 Answer(s)

Vishal Kumar Thakur
Advocate

Each commodity passes through different stages of production and distribution before finally it reaches the Consumer. Some value is added at each stage of the production and distribution chain. Value Added Tax (VAT) is tax on value addition at each stage. Under VAT system, a dealer collects tax on his sales, retains the tax paid on his purchase and pays balance to the Govt. Treasury. It is a consumption tax because it is borne ultimately by the final Consumer. The tax paid by the dealer is passed on to the buyer. It is not a charge on the dealer. Hence, VAT is a multipoint tax system with provision for set off of tax paid on purchases at each point of sale.

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