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List out the difference between Service Tax and VAT?

Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 asked

Hello, I would like to know about the difference between service tax and VAT. So please give me the the detail information about the difference between Service tax and VAT?

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 answered

DIFFERENCE BETWEEN SERVICE TAX AND VAT - Tax on sale of Commodities within state(Intrastate) is VAT,Outside the state(Interstate) is CST. - Tax levied on providing of Service is Service Tax.Now service Tax rate is 15% - VAT is levied by State Government. - Service Tax is Levied by Central Government.

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 answered

Key Differences Between VAT and Service Tax The following are the major differences between VAT and Service Tax: Tax imposed on the production and sale of a commodity is known as Value Added Tax (VAT). Tax on services rendered is known as Service Tax. VAT is a multi point tax, whereas Service Tax is a single point tax. VAT is charged on physical items i.e. goods while Service Tax is charged on non-physical items i.e. services. VAT is imposed by the State Government but Services Tax is imposed by Central Government. VAT is governed by the statute of the respective state. On the other hand, Service Tax is governed by the Finance Act, 1994. VAT was introduced in the year 2005, all over the country. Conversely, Service Tax was introduced for the first time in the year 1994. The VAT rate is different for different category of commodities. In contrast to Service Tax, has a flat rate. VAT is applicable within the jurisdiction of the state, whereas Service Tax is applicable all over the country except in Jammu & Kashmir

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 answered

BASIS FOR COMPARISON- VAT. & SERVICE TAX 01. Meaning: Tax charged on the value addition to commodities is known as VAT.& Tax charged on the services provided is known as Service Tax. 02. Nature: VAT- Multi point tax SERVICE TAX- Single point tax 03. Charged on: VAT-Both on production and trading of goods.SERVICE TAX- Services provided. 04. Levied by: VAT-State Government. SERVICE TAX- Central Government 05. Statute: VAT-Concerned State Act SERVICE TAX- Finance Act, 1994 06. Introduced in the year. VAT- 2005 SERVICE TAX- 1994 07. Rate: VAT- Variable, for different types of commodities SERVICE TAX- Uniform for all services. 08. Area: VAT- Within the state SERVICE TAX- All over the country subject to certain exception.

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 answered

> List out the difference between Service Tax and VAT? --Key Differences Between VAT and Service Tax The following are the major differences between VAT and Service Tax: --Tax imposed on the production and sale of a commodity is known as Value Added Tax (VAT). Tax on services rendered is known as Service Tax. --VAT is a multi point tax, whereas Service Tax is a single point tax. --VAT is charged on physical items i.e. goods while Service Tax is charged on non-physical items i.e. services. --VAT is imposed by the State Government but Services Tax is imposed by Central Government. --VAT is governed by the statute of the respective state. On the other hand, Service Tax is governed by the Finance Act, 1994. --VAT was introduced in the year 2005, all over the country. Conversely, Service Tax was introduced for the first time in the year 1994. --The VAT rate is different for different category of commodities. In contrast to Service Tax, has a flat rate. --VAT is applicable within the jurisdiction of the state, whereas Service Tax is applicable all over the country except in Jammu & Kashmir.

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Open uri20170510 32134 nwqd3c?1494421745 answered

** Difference Between VAT and Service Tax: --------------------------------------- Meaning Tax charged on the value addition to commodities is known as **VAT**. Tax charged on the services provided is known as **Service Tax**. ---------- Nature **VAT**: Multi point tax. **Service Tax**: Single point tax ---------- Charged on: **VAT:** Charged on Both on production and trading of goods. **Service Tax:** Charged on Services provided. ---------- Levied by **VAT:** State Government **Service Tax:** Central Government ---------- Statute **VAT:** Concerned State Act **Service Tax:** Finance Act, 1994 ---------- Introduced in the year **VAT:** 2005 **Service Tax:** 1994 ---------- Rate **VAT:** Variable, for different types of commodities **Service Tax:** Uniform for all services. ---------- Area **VAT:** Within the state **Service Tax:** All over the country subject to certain exception.

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 answered

Service Tax charged on the services like Contractors, Transporters, Clearing & Forwarding Agent, Hospital Services etc. where as VAT is charged on sales of the Goods. Service Tax current Rate is 12.5% & Swatch Bhart Cess on Basic 0.50% whereas as Goods sales in with in State charged 12.5 & 5% & sales outside State charged 2% against C form. VAT is Revenue source for States Government whereas Service Tax is Revenue source for Central Government. Service Tax Return submit Twice in a Year where as VAT Return submit on Monthly or Quterly as per Turnover/ Sales.

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Open uri20170510 32134 ivjxpn?1494421728 answered

Hi Renju M.r Service Tax is charged on services provided by one person to another person for consideration. VAT & CST is charged on sales of goods wherein VAT is charged for sale of goods within a particular state and CST is charged on Interstate sales of goods. Indian Economy was majorly dependent on agriculture and production whereas service portion constituted to minimal extent to the country's economy, however after the dawn of globalisation in India after 1992 share of service industry started increasing and now if you see the contribution of service sector to GDP is more around 60-70%. Thus finance minister in 1994 introduced service tax in that year which was majorly on 3 services that now due to negative list regime all services are covered under the ambit of service tax except for those provided under negative list and mega exemption. VAT & CST are charged on sale of goods. VAT as is known as Value Added Tax substituted the cascading effect regime of Sales Tax prevalent in the country. In VAT tax is charged on the value addition portion and there is no cascading effect.

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