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Which one of the following is not a feature of “Value Added Tax”?
[2011]
- 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 production distribution 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&...
VAT, being a ' tax on sale or purchase of goods within a State' is a State Subject by virtue of Entry 54 of State List of the Seventh Schedule of the Constitution of India. Since VAT/Sales tax is a State subject, the Central Government has been playing the role of a facilitator for successful implementation of VAT.
Most Upvoted Answer
Which one of the following is not a feature of “Value Added Tax&...
Explanation:
Central Government Control:
Value Added Tax (VAT) is a tax system that is primarily under the control of the central government. The central government sets the rules and regulations regarding VAT implementation in the country.
State Government's Role:
While the central government is responsible for VAT implementation, state governments play a crucial role as facilitators in the successful execution of VAT. State governments assist in the collection and administration of VAT but do not have direct control over the tax system.
Multi-Point Taxation:
VAT is a multi-point destination-based tax system, meaning that it is levied at each stage of the production and distribution chain. This ensures that tax is paid on the value added at every stage of the supply chain.
Consumer Burden:
VAT is a tax on the final consumption of goods and services. While businesses are responsible for collecting and remitting VAT, ultimately, it is the consumer who bears the burden of the tax. The cost of VAT is passed on to the final consumer through the price of goods and services.
Therefore, option D is not a feature of Value Added Tax as state governments play a significant role in facilitating the successful implementation of VAT alongside the central government.
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Which one of the following is not a feature of “Value Added Tax”?[2011]a)It is multi-point destination-based system of taxationb)It is a tax levied on value addition at each stage of transaction in the production distribution chainc)It is a tax on the final consumption of goods or services and must ultimately be borne by the consumerd)It is basically a subject of the central government and the state governments are only a facilitator for its successful implementationCorrect 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”?[2011]a)It is multi-point destination-based system of taxationb)It is a tax levied on value addition at each stage of transaction in the production distribution chainc)It is a tax on the final consumption of goods or services and must ultimately be borne by the consumerd)It is basically a subject of the central government and the state governments are only a facilitator for its successful implementationCorrect 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”?[2011]a)It is multi-point destination-based system of taxationb)It is a tax levied on value addition at each stage of transaction in the production distribution chainc)It is a tax on the final consumption of goods or services and must ultimately be borne by the consumerd)It is basically a subject of the central government and the state governments are only a facilitator for its successful implementationCorrect answer is option 'D'. Can you explain this answer?.
Which one of the following is not a feature of “Value Added Tax”?[2011]a)It is multi-point destination-based system of taxationb)It is a tax levied on value addition at each stage of transaction in the production distribution chainc)It is a tax on the final consumption of goods or services and must ultimately be borne by the consumerd)It is basically a subject of the central government and the state governments are only a facilitator for its successful implementationCorrect 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”?[2011]a)It is multi-point destination-based system of taxationb)It is a tax levied on value addition at each stage of transaction in the production distribution chainc)It is a tax on the final consumption of goods or services and must ultimately be borne by the consumerd)It is basically a subject of the central government and the state governments are only a facilitator for its successful implementationCorrect 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”?[2011]a)It is multi-point destination-based system of taxationb)It is a tax levied on value addition at each stage of transaction in the production distribution chainc)It is a tax on the final consumption of goods or services and must ultimately be borne by the consumerd)It is basically a subject of the central government and the state governments are only a facilitator for its successful implementationCorrect answer is option 'D'. Can you explain this answer?.
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