What is VAT (Value-Added Tax) ?

Defination:
  • VAT stands for Value-Added Tax.
  • A tax Imposed on value addition right from the stage of production upto the stage of final consumer. 
  • Thus, VAT extends to both production and distribution. 
  • It will replace CENVAT.

Advantages of VAT:
  • No cascading effect
  • 2. No tax evasion
  • 3. Tax base will expand
  • VAT ihas been implemented from April 1, 2005 throughout the country.