What is the full form of VAT?
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What is the full form of VAT?
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The full form of VAT is Value-added tax. It is a type of indirect tax imposed on goods. Vat added at every stage of the production cycle. Starting from raw material to final good and final sale.
VAT is introduced on 1st April 2005, the amount of value-added identified at every point, then tax is charged for all. finally, the end customers pay VAT while buying the products.
Advanatage of VAT
VAT is easy to manage as compare to other indirect tax.
Revenue generation is constant.
The enormous amount of revenue generated on the low tax rate.
VAT is imposed on all types of business because VAT is a neutral tax.
Disadvantage
VAT rate is different in every state.
VAT implementation is expensive because VAT is based on the full billing system.
All sale and purchase record must be maintained, which ultimately increase the expenses.
VAT law is different in every state
