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Which one of the following is not a feature of “value added tax”?
- a)It is multi-point destination-based system of taxation.
- b)It is a tax levied on value addition at each stage of transaction in the productiondistribution chain.
- c)It is a tax on the final consumption of goods or services and must ultimately be borne by the consumer.
- d)It is basically a subject of the central government and the state governments are only a facilitator for its successful implementation.
Correct answer is option 'D'. Can you explain this answer?
Verified Answer
Which one of the following is not a feature of “value added tax&...
Value Added Tax (VAT) is a multistage sales tax with credit for taxes paid on business purchases. As the economy grew, business complexities led to the taxation structure towards its own peril. This warranted a revision of the existing taxation. For achieving this, the government introduced a single rate of excise (CENVAT) as a major step and bought in a fundamental rationalization in the tax structure and levy. Features of VAT are:
1. Uniform schedule rates of VAT for all states. This would make the tax system simple and uniform and prevent unhealthy tax competition among states.
2. The provisions of input tax credit would help in prevent cascading effect tax.
3. The provisions of self assessment by dealers would reduce harassment small traders with turn over upto Rs 5 lakh would be exempt from the provisions of VAT.
4. The zero – rating of exports would increase the competitiveness of Indian exports.
Sales tax / VAT is basically a state subject, the central government is playing the role of facilitator for successful implementation of this significant reform measures.
Whether it be Sales Tax of Value Added Tax it increases the cost of the product bought by the consumers and as such it is ultimately be borne by the consumer .
1. Uniform schedule rates of VAT for all states. This would make the tax system simple and uniform and prevent unhealthy tax competition among states.
2. The provisions of input tax credit would help in prevent cascading effect tax.
3. The provisions of self assessment by dealers would reduce harassment small traders with turn over upto Rs 5 lakh would be exempt from the provisions of VAT.
4. The zero – rating of exports would increase the competitiveness of Indian exports.
Sales tax / VAT is basically a state subject, the central government is playing the role of facilitator for successful implementation of this significant reform measures.
Whether it be Sales Tax of Value Added Tax it increases the cost of the product bought by the consumers and as such it is ultimately be borne by the consumer .
Most Upvoted Answer
Which one of the following is not a feature of “value added tax&...
Features of Value Added Tax:
1. Multi-Point Destination-Based System:
- VAT is a multi-point destination-based system of taxation where tax is levied on the value addition at each stage of the production and distribution chain.
2. Tax on Final Consumption:
- VAT is a tax on the final consumption of goods or services, meaning it is ultimately borne by the consumer.
3. Central Government Subject:
- VAT is basically a subject of the central government, and the state governments play a role as facilitators for its successful implementation.
Not a Feature of Value Added Tax:
4. State Government Control:
- The statement that state governments are only facilitators for the successful implementation of VAT is not entirely correct. While VAT is primarily under the purview of the central government, state governments also play a significant role in its administration and collection. State governments have the authority to levy and collect VAT on intra-state transactions, whereas the central government oversees VAT on inter-state transactions. Therefore, it is not accurate to say that state governments are merely facilitators in the implementation of VAT.
1. Multi-Point Destination-Based System:
- VAT is a multi-point destination-based system of taxation where tax is levied on the value addition at each stage of the production and distribution chain.
2. Tax on Final Consumption:
- VAT is a tax on the final consumption of goods or services, meaning it is ultimately borne by the consumer.
3. Central Government Subject:
- VAT is basically a subject of the central government, and the state governments play a role as facilitators for its successful implementation.
Not a Feature of Value Added Tax:
4. State Government Control:
- The statement that state governments are only facilitators for the successful implementation of VAT is not entirely correct. While VAT is primarily under the purview of the central government, state governments also play a significant role in its administration and collection. State governments have the authority to levy and collect VAT on intra-state transactions, whereas the central government oversees VAT on inter-state transactions. Therefore, it is not accurate to say that state governments are merely facilitators in the implementation of VAT.
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Which one of the following is not a feature of “value added tax”?a)It is multi-point destination-based system of taxation.b)It is a tax levied on value addition at each stage of transaction in the productiondistribution chain.c)It is a tax on the final consumption of goods or services and must ultimately be borne by the consumer.d)It is basically a subject of the central government and the state governments are only a facilitator for its successful implementation.Correct answer is option 'D'. Can you explain this answer?
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Which one of the following is not a feature of “value added tax”?a)It is multi-point destination-based system of taxation.b)It is a tax levied on value addition at each stage of transaction in the productiondistribution chain.c)It is a tax on the final consumption of goods or services and must ultimately be borne by the consumer.d)It is basically a subject of the central government and the state governments are only a facilitator for its successful implementation.Correct answer is option 'D'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Which one of the following is not a feature of “value added tax”?a)It is multi-point destination-based system of taxation.b)It is a tax levied on value addition at each stage of transaction in the productiondistribution chain.c)It is a tax on the final consumption of goods or services and must ultimately be borne by the consumer.d)It is basically a subject of the central government and the state governments are only a facilitator for its successful implementation.Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Which one of the following is not a feature of “value added tax”?a)It is multi-point destination-based system of taxation.b)It is a tax levied on value addition at each stage of transaction in the productiondistribution chain.c)It is a tax on the final consumption of goods or services and must ultimately be borne by the consumer.d)It is basically a subject of the central government and the state governments are only a facilitator for its successful implementation.Correct answer is option 'D'. Can you explain this answer?.
Which one of the following is not a feature of “value added tax”?a)It is multi-point destination-based system of taxation.b)It is a tax levied on value addition at each stage of transaction in the productiondistribution chain.c)It is a tax on the final consumption of goods or services and must ultimately be borne by the consumer.d)It is basically a subject of the central government and the state governments are only a facilitator for its successful implementation.Correct answer is option 'D'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Which one of the following is not a feature of “value added tax”?a)It is multi-point destination-based system of taxation.b)It is a tax levied on value addition at each stage of transaction in the productiondistribution chain.c)It is a tax on the final consumption of goods or services and must ultimately be borne by the consumer.d)It is basically a subject of the central government and the state governments are only a facilitator for its successful implementation.Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Which one of the following is not a feature of “value added tax”?a)It is multi-point destination-based system of taxation.b)It is a tax levied on value addition at each stage of transaction in the productiondistribution chain.c)It is a tax on the final consumption of goods or services and must ultimately be borne by the consumer.d)It is basically a subject of the central government and the state governments are only a facilitator for its successful implementation.Correct answer is option 'D'. Can you explain this answer?.
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