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Thx Vineet.
This message was posted from a T230
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Posted: 2005-03-31 06:28:24
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whiz, get ur internet working man
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Posted: 2005-03-31 06:35:44
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How does VAT effect the common man like you and me?
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Posted: 2005-03-31 06:36:00
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@gov: Not very ,much. We were more affected by the End-Point taxation system. With that if we bought a product "Without-the-bill" the goverent didn't get the tax for the entire product and all its subcomponents. With the Multi-point taxation system (aka VAT) the goverment gets some money in any case.
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Posted: 2005-03-31 06:44:11
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That means billing computers in spares will also be tax'd right? That means i have to pay them(govt) 10% extra. It affects not only items like that but also every other things. And the sellers cannot show "corrected" books and they would have to show their original sales. Right?
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Posted: 2005-03-31 06:49:00
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@gov: Quite right, however, The reseller may choose not to bill the product at all. But that will make little difference to him, because he only has to pay tax on the Value Addition he makes. Hence he probably will choose to pay the tax as not paying would mean a very little profit, and much higher risk. But for us End-Buyers, I makes Little or No difference.
To explain this, Say the manufacturer gives the reseller the product at Rs. 10, the seller can sell it for Rs. 12, but he will only charge tax on Rs.2, because the Rs. 10 has already been paid tax for. i.e the reseller is adding Rs. 2 to the value of the product, while the manufacturer may be producing it for Rs. 7, and Rs. 3 is ithe Value Addition, so the manufacturer will pay tax on Rs. 3. This is VAT.
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Posted: 2005-03-31 07:03:32
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I c. So the govt generate more income and the resellers profit will go down. They are using this to aim the big sellers like supermarket chains and bigbaazar's? But this also effects the small time sellers, right? (Like the kinda ppl that own a single shop for living)
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Posted: 2005-03-31 07:10:00
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@Gov: In a way that is correct, but, now they dont charge a Whopping 7% at point of sales, they charge 2-5% depending on the value addition slabs, i think upto Rs. 25 of value addition, there is no tax at that point, so most very small shopkeepers are safe.
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Posted: 2005-03-31 07:16:55
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Hmmm . . . . . But then, why is everybody against VAT?
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Posted: 2005-03-31 07:23:00
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That is because VAT is a pro-consumer system. In the Old system of Sales Tax, just by not providing the bill, the seller saved a whopping 7%!!!.
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Posted: 2005-03-31 07:29:13
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