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Difference between VAT and GST

                       Difference Between VAT & GST


    
                                         VAT and GST are both counter approach taxation systems by the government to charge taxes on goods and services across the nation. The old tax system,i.e. value added tax ,was the method of applying taxes on goods while the goods and service tax is set to change this course of action towards consumers. 
                   VAT is an indirect tax,which is imposed on goods and services at each stage of production,starting from raw materials to final product.VAT is levied on the value additions at different stages of production.       
                                   Goods and Service Tax (GST} is an indirect tax (or consumption tax} levied in India on the sale of goods and services. GST is levied at every step in the production process,but is refunded to all pwholearties in the chain pf production other than the final consumer .

Difference Between VAT and GST   



  • VAT is applicable only on the sale of goods while GST is applicable both on goods and services.
  •  The taxable event in case of VAT is the sale of goods.However,in case of GST  it is the supply of goods and services.
  • .VAT laws and tax rates were different in each state and each of them kept the whole share of collected tax with themselves. Howe ever,under the GST regime ,both SGST and CGST is collected from the  supply of goods services  and later bifurcated by the central and state governments.
  • The credit of input tax cannot be claimed for services in case of VAT as it is applicable only to goods.But ,input tax credit can be claimed for both goods as weii as services in case of GST as it applies to both.
  • Vat dealer has right to deposit his net vat liability by deducting input VAT on goods purchased and from output VAT goods sold.however  GST is applicable on goods as well as services provided,the GST portal system calculate the input credit which is used for syduring the next GST liability.
  • VAT - If turnover is or beyond Rs.10 lakh .                                                                                         GST - If turnover is or beyond Rs.20 lakh.    ..

Comments

  1. Anonymous1 June 2022 at 04:30

    I got more knowledge about vat consultants in Dubai for individuals and businesses. Thanks for sharing such an informative article.

    ReplyDelete

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