Meaning of VAT
Value Added Tax (VAT) is nothing but a generalconsumption tax that is assessed on the value added to
goods & services.
It is the indirect tax on the consumption of the goods, paidby its original producers upon the change in goods or upon
the transfer of the goods to its ultimate consumers.
It is based on the value of the goods, added by thetransferor. It is the tax in relation to the difference of thevalue added by the transferor and not just a profit.