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Q.

What is difference between VAT AND CENVAT ?

Tags: cenvat, difference between vat
Asked by Sonia Sharma, 01 Mar '07 04:19 pm
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Answers (2)

1.

LOAD of Difference between them. Well, the methodology of calculation might work the same but they are different at respective levels.

For most common difference is , VAT is related to State and CENVAT is CENTRAL
Let me give you the definition of both might be simpler foe you to figure the difference then,

CENVAT - This is a replacement for the earlier MODVAT scheme and is meant for reducing the cascade effect of indirect taxes on finished products. The scheme is a more extensive one with most goods brought under its preview.
MODVAT
It stands for Modified Value Added Tax and is a way of giving some relief to the final manufacturers of goods on Excise Duties borne by their suppliers.

VAT-
Value Added Tax It is based on the difference between the value of the output over the value of the inputs used.
Answered by Hardik Mardia, 14 Mar '07 02:27 pm

 
  
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2.

VAT is value added tax imposed by respective states & charged by seller while invoicing. CENVAT is input tax (excise duty or Service tax)paid while we purchase any thing which we can adjust agaisnt our tax liablitiy.
Answered by GURDEEP CHAWLA, 01 Mar '07 07:12 pm

 
  
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