GST vs VAT – What is the Basic Difference between GST and VAT

Both GST and VAT are indirect taxes, but they have some key differences. One of the main difference between GST and VAT is that GST is a destination-based tax, while VAT is an origin-based tax. This means that GST is levied at the point of consumption, while VAT is levied at the point of origin. Now, why should you invest your time in understanding these tax systems? The answer lies in the tangible impact they have on your finances. From the way they affect the cost of goods and services to their influence on international trade, is significant. Being equipped with the right knowledge can make all the difference. GST full form is Goods and Services Tax, which is a comprehensive tax on the supply of goods and services. VAT stands for value-added tax, which is a consumption tax on the value added at each stage of production and distribution of goods. You will get to know that vat is applicable on which type of goods and disadvantages of vat and benefits of gst. Today, we will explore the basic difference between GST vs VAT and take a look at the reasons why GST overtook the VAT system.