19 October 2013
MR KHAN , VAT or value added tax (VAT) is a form of consumption tax. A VAT is like a sales tax in that ultimately only the end consumer is taxed. The mechanism of VAT is such that, for goods that are imported and consumed in a particular state, the first seller pays the first point tax, and the next seller pays tax only on the value-addition done - leading to a total tax burden exactly equal to the last point tax. Over 120 countries worldwide have introduced VAT over the past three decades and India is amongst the last few to introduce it. VAT was introduced into the Indian taxation system from 1 April 2005.
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