Letter of Transmittal

November 17, 2003
Shubhankar Shil
Course instructor
School of Business,
Independent University, Bangladesh
Baridhara, Dhaka.

Sub: Letter of Transmittal

Dear Sir,
It is our immense pleasure to submit our class report on Value Added Tax, as you asked to prepare and submit as a requirement of Acn-402 programs. The name of our project is “Critical Appraisal on Value Added Tax”.

We have tried our best to compile the pertinent information as comprehensively as possible. And if you need any further information, we will be obliged to assist you.

Thanking you,

Md. Sakil Siddique
Md. Julfiker Ali
Mostafizur Rahman
Muhammad Masum
Md. Wahed Ali Bari

ACKNOWLEDGEMENTS

At first we would like to place our gratitude to our instructor, Mr. Shubhankar Shil for giving us such an important assignment on VAT as a class project. A very special thanks goes to him for helping us in all types of discussion and also providing valuable advice in the successful completion of this project. His overwhelming support for this report gave us the inspiration to do a better report. 

1. EXECUTIVE SUMMARY

This report “Critical Appraisal on Value Added Tax” is prepared to fulfill the partial requirement of Accounting 402 program of Business Administration Program of Independent University, Bangladesh. The topic of dissertation was selected upon consultation with course instructor of respective department.

The main aim of this report is to find out the summary of Value Added Tax Law, 1991 and justify the different findings. From this analysis we have found out different issues of VAT act. This analysis has done from Value Added Tax Law, 1991 by Md. Altaf Hossain (MALLB), which was the main source of information.

At the very beginning of the work we came to know that The National Board of Revenue (NBR) is the central authority for tax administration in Bangladesh. The main responsibility of NBR is to collect domestic revenue, Import Duties and Taxes, VAT and Income Tax for the government. NBR is also responsible for formulation and continuous re-appraisal of tax-policies and tax-laws in Bangladesh.

Now it is time to discuss about the project. This project is based on mainly three parts. In the first part we have discussed about the summary of the VAT act and in the second part we have discussed about some findings, which we have found during project analysis. Finally we have given some issues, which we didn’t discuss for the shortage of time and this may be used for future generation in doing further research on VAT act.

We have divided the summary part into thirteen sections for the shake of clear understanding about VAT. In the first section we have discussed about the imposition of VAT, which includes the remission of tax and the impact when it is realized that the VAT has been imposed less. The rate of vat is 15% and it is imposed on imported goods. To get the remission from taxes the assessee has to prove himself by showing the invoice and he has to pay the proper tax to the proper officer. The second section includes the application of tax rate from where we see that the tax will be applicable on that date on which the bill of entry presented. The third section is about the determination of cost for calculation of vat. Here we see that the calculation of vat for different product and service is different. For example incase of imported goods, the VAT rate will be determined by adding import duty, supplementary duty and other duty and tax on the other hand in case of services VAT will be imposed on the total receipts. The fourth section is about the method and time of payment. In this case we see that the board has the power to fix the time and procedure of the payment of vat. Another important matter is that when some one deducts tax at source, he must give a certificate to that person from whom he cut the tax and he has to deposit money to the treasury within seven days. The fifth section is about imposition of supplementary duty. Here we see that supplementary duty will be imposed only on the luxurious goods and services, which are socially undesirable and the payment of supplementary duty will be same as the payment of VAT. The sixth section contains turnover tax from where we came to know that the commissioner has the power to assess the turnover tax. Here the most important fact is that any manufacturer or producer who is not required to be registered and supplying taxable goods and services will pay turnover tax at the rate of 4% of their annual turn over. The seventh section is about registration. This section includes different facts about the exemption from registration, voluntary registration, change of information relating to registration and the Cancellation of registration. The eighth section is maintaining of accounts. From this section we came to know that every company has to maintain some documents, which is required to determine the tax liability. The ninth section is about submission of returns. Here it is clearly stated that every producers or manufactures who deal with taxable goods and services have to submit their return according to the rule to the proper officer at every tax period. In the tenth section we have discussed about forefeiture, which includes the extent of forfeiture and the power of adjudication of forfeiture goods. Here the important concept is that if any vehicle carryout the forefeited goods then that vehicle and its tackle will be considered as forefeited. In the eleventh section we have discussed about power. The board has the power to appoint some person in order to execute VAT act. Such persons are commissioner, additional commissioner, joint commissioner, deputy commissioner and superintendent or vat officer. Under power section we have discussed different types of power of board, vat officer and the Government related to vat act. In the twelfth section we have discussed about offences and penalties. There are some penalties for breaking the VAT law of the registered person. There are different types of penalties for different types of offences. The victim might be charged from 25000 to 1 lac taka or imprisonment for 1 year or both for different kinds of offences. Finally in the thirteenth section we have discussed about appeal. When some one is aggrieved with the decision, he has the proper right to appeal against that decision. The appeal is made before the commissioner and it should be within 3 months of the date from given decision.

In the second part of this project we have discussed about some findings, which were seemed to be important to us. In this part we have highlighted the vat rate, the necessity of registration, vat authority, misuse of bonded warehouse, imposition of supplementary duty, problem create from invoices, turnover tax benefit, tax rebate, necessity of training for vat officer and some other important topics. The topics that we have highlighted in the findings are sometime confusing. So there should be a detailed analysis of these things. Then it will be better for next generation to understand the different criteria of vat.

2. INTRODUCTION

2.1. Origin of the Report

This report is prepared to fulfill the partial requirement of Acn 402 of business administration program of Independent University on the Value Added Tax. We based this report from the background information and knowledge that we acquired from the book of Value Added Tax Law, 1991.

2.2. Objective of the Report

The specific objectives aimed for this report is:
1. To fulfill the partial requirement of the course Acn 402 under the guidance of the coordinator Shubhankar Shil.
2. To gain experience and knowledge about value added tax, which will help us in the practical working environment.
3. To find out the important factors related with vat.
4. Identify the problem area regarding the vat law.

2.3. Research Methodology

Information used to prepare this report has been collected from the Secondary sources. The secondary sources of information were collected materials from the book of Value Added Tax Law, 1991 and different websites in the internet.

2.4. Limitations of the Study

1.  Lack of availability of information and data, some time there are some back dated information they provide.
2.  The record system of the rules and regulations is not efficient
3.  As we are new in this area, it is really difficult for us.
4.  Time is not sufficient to complete the study perfectly.

3. ABOUT VAT

VAT (Value Added Tax) is an indirect tax on consumer expenses. VAT is charged and collected at each stage of the production process and not only on the final sale. VAT is normally borne by the consumer in the price paid for goods and services. It is also charged on business transactions. All goods and services which are VAT rated are called ‘taxable supplies’. Any person must charge VAT on his taxable supplies from the date he first needs to be registered. The value of these supplies is called his ‘taxable turnover’. VAT does not apply to certain services because the law says these are ‘exempt’ from VAT. These include loans of money, some property transactions, insurance and certain types of education and training. Supplies which are exempt from VAT do not form part of taxable turnover.

               VAT Rate
Country                     VAT Rate (%)
SWITZERLAND             7.6
GERMANY                    16.0
UNITED KINGDOM      17.5
NETHERLANDS            19.0
FRANCE                 19.6
ITALY                     20.0
BELGIUM                21.0
IRELAND                21.0

Source: Ernst & Young, Worldwide Corporate Tax Guide 2003, (www.ey.com)

4. LITERATURE SURVEY

VAT-1991 SUMMARY

4.1. Imposition of Value Added Tax

The rate of Value Added Tax is fixed and payable at 15% upon all goods imported into Bangladesh except the goods or services exported or considered to be exported from Bangladesh or food and other things supplied in transport leaving Bangladesh for consumption outside Bangladesh. This exemption will not be applicable to the goods re-imported or treated as being re-imported into Bangladesh and such goods which have not exported with in thirty days of the bill of the export.

Value Added Tax will be paid by the importer, the supplier, the provider of service and in other cases the supplier.

4.1. a. Remission of taxes
Any assessee will be able to claim credit of input tax against payable output tax which is due to on the supply of his goods or services. But the credit is not allowed where the VAT paid on service accordance with the rule. It is also not allowable if any assessee paid VAT without the invoice proving that VAT has been paid. At this kind of situation if anybody obtains remission then the proper officer will cancel the remission and order reconciliation of the current tax return. When any assessee supplied the goods upon which VAT is not chargeable he/she will get remission of input tax against output tax.

4.1. b. Realization of VAT imposed less
When the vat or supplementary custom duty has not been determined or the person has paid less tax due to wrong interpretation, then he is bound to pay the actual amount to the concerned officer within 3 months from the date of paid tax. In the case of imported goods, if the tax is not paid then it is realized by the board. And if the tax payer has any objection against the decision, then he can get an opportunity for hearing.

4.2. Application of Tax Rate
In the case of a supply of taxable goods or services the rate of Value added Tax will be that rate of Value Added Tax imposed upon goods which are produced, manufactured, imported or purchased by any registered person.
The tax will be applicable on that date on which the bill of entry presented. Incase of imported goods it will be applicable when those goods have reached the country. Imposing of the tax will be applicable at the date of release of goods from the godown.

4.3. Determination of Cost for Calculation of VAT
1. Incase of imported goods the VAT rate will be determined by adding import duty, supplementary duty and other duty and tax, except advance income tax.

2. The rate of VAT upon the cost of goods supplied will be the total price, which the manufacturer receives from buyer included cost of manufacture, any commission paid, supplementary duty and others cost.

3. Where Value Added Tax is to be imposed on the basis of the retail price of goods, the Government fixes the retail price of those goods by Gazette notification. They will impose the Value Added on the retail price, which will be calculated by the manufacturer and approved by the proper officer. The price must be printed clearly, legibly and unreasonably on the surface of the goods, or on their packet, bag etc.

4. In the case of services VAT will be imposed on the total receipts and in case of providing any specific service the VAT rate will be determined by the board.

5. In case of such goods where the trade discount is allowed, the amount of VAT will be determined on the cost of the goods after deduction of trade discount. But the discount must be shown on the invoice and the quantity of trade discount must be consistent with normal business policy.

6. If the Board thinks after any inquiry that tariff value is necessary in order to determine VAT, then they will be able to fix a tariff value for the taxable goods or services by an order issued in a Gazette notification.

4.4. Method and Time of Payment

Value added tax on imported goods will be paid at the same time and as the same way as import duty is paid. It will be payable upon goods which are produced, manufactured, imported, purchased or any taxable service is rendered by any registered person at the time of one of the following activities whichever occurs first:

• When the goods are delivered or supplied.
• When an invoice relating to the goods is given.
• When any goods are used personally or given for use to another person.
• When the service is rendered.
• When an invoice relating to the service is rendered.
• When part or full payment is received.

The Board is also able to fix the time of payment, and the procedure to pay VAT. Besides this construction firm, indenting firm, travel agency, motor garage, workshop or dockyard or any such person who is specified in the Government Gazette notification can deduct VAT at source and deposit the tax amount to the treasury. The person who deducts VAT at the source must give a certificate in respect of such realization to the person who renders the service.

If any person who pays on account of service or commission and fails to account correctly for Value Added Tax then will liable as follows:

a. Realization of tax with 2% interest per month.
b. Value Added Tax realized, deducted and deposited will be treated as paid on behalf of the service rendered and subject to the certificate issued can be shown on the return made by the service rendered.

4.5. Imposition of Supplementary Duty

1.Luxury goods and such other goods or services, which are not essential and socially undesirable and which are listed in the third schedule and supplied in Bangladesh, supplementary duty will be imposed in accordance with the rate specified in that schedule.
2. In order to impose supplementary duty, the cost of the goods or services will be taken as:

a. That value upon which import duty is imposed under Customs Act.
b. In the case of goods on which Value Added Tax is imposed on the basis of retail price, the supplementary duty will be included in the retail price of those goods.
3. The supplementary duty will be payable according to the terms and conditions of the payment of VAT.

4.6. Turnover Tax

Any manufacturer or producer who is not required to be registered and supplying taxable goods and services will pay turnover tax at the rate of 4% of their annual turn over.

The Board by Government Gazette/Notification has the right to provide exemption of the goods and services for the certain period considering its importance to the people through proper inquiry.

A Turnover tax determination Commission is formed by the Government notification with efficient, knowledgeable and experienced people, which will fix the turnover tax at the rate of 4% and dispose the appeal against any decision relating turnover given by the tax officer.

The power and the responsibility of the commission will be applied and executed by benches formed by the Chairman. The Chairman will determine the working procedure, fix the date and place for any meeting of benches. If there is any problem to take any decision then the decision will be taken on the basis of the majority. In other cases Chairman himself will take the decision.

Any assessee may appeal to the commission for the assessment of turnover tax. In this situation the commission will investigate necessary record or talk with the proper officer, and then they will be able to order the acceptance or rejection of the prayer or appeal. The proper officer will dispose of the prayer or appeal within sixty working days from date of receipt. Then they will inform the applicant and go to his business place and see the necessary documents.

No appeal under this section may be submitted to the commission whether any tax payer is liable to registration that their taxable turnover is below the levels for which registration of VAT is required.

4.7. Registration

A supplier of taxable goods or services or an importer of any goods or an exporter of any goods or services must be registered.
If any person fails to apply for registration and if it is decided after inquiry that the person should be registered then the proper officer will register the person and from that date the person will be treated as registered under VAT.

4.7. a. Exemption from registration
By a special order the Government will be able to exempt any class of person from the requirement of registration on the basis of the receipt or receivable annual turnover from their supply of taxable goods or service.
The exemption is applicable for the person of which annual turnover is not more than the sum fixed time to time by Government Gazette notification.
The Board has special power to exempt any exporter or importer from the registration requirement.

4.7. b. Voluntary registration
Any person exempted from the registration will be able to apply for optional registration to the proper officer. And if the officer is satisfied with the person, he will give a registration letter to the applicant stating the business identification number and such registered person will be treated as tax payer. In the voluntary registration the assessee enforced the officer to be registered.

4.7. c. Change of information relating to registration
Any kind of change of information as given in the in the application of registration, the registered person must inform the proper officer within fourteen days.

4.7. d. Cancellation of registration
If any person wants to stop the supply of taxable goods, services, or importation of taxable goods or exportation of taxable goods must inform the proper officer within fourteen days. If the proper officer satisfied with the given information and if he found that the person has no outstanding liability to pay VAT, then after certain procedure he will cancel the registration.
In other cases if the proper officer finds that the person’s turnover is less than the fixed amount and he doesn’t need the registration any more, they will simply cancel the registration.

If the person has any tax or duty remission after the cancellation then they will receive such remission credit as repayment.

4.8. Maintaining of Accounts

There are some statements, which are required to determine the tax liability and they must keep in the organization. Such statements are purchase invoices, export invoices, statements of deposited money, statement of stock and some other documents required by the board by Government Gazette notification.

All registered persons have to issue a serially numbered invoice, so that Government Gazette can easily get the list of taxable goods supplied and taxable imported goods sold out. In this case they have no right to issue more than one invoices for a single operation. And they should preserve the statement of purchase, export, stock, deposited money etc. for at least six years.

4.9. Submission of Returns

Every producers or manufactures who deal with taxable goods and services have to submit their return according to the rule to the proper officer at every tax period.

Under this act, the proper officer has the right to examine the return. And after examinations if it is proved that the person has paid less tax, and then he has the right to get back the proper amount within seven days. If the officers feel any doubt of the paid amount he can arrange a committee to check the produce element, quantity of service and the amount of money. In case of excess payment the vat prayer can adjust the amount due in the next assessment.

4.10. Forefeiture

Vat authority has the right to forefeit the taxable goods. In this case when any registrable person engaged himself with the business of taxable goods without being registered and when any registered person removes taxable goods from business area without having certificate of dispatch or if the certificate is not with him up to his destinated place, then they have to pay penalties, which will be the double of vat or supplementary custom whichever is higher.

4.10. a. Extent of Forfeiture

There are some other goods which can be forefeited. Such as the goods which are found in the forefeiture package, the vehicle which is used to Cary and the forefeiture product and if any ship is declared to forefeit than the whole tackle and furniture of that ship will also forefeited.

4.10. b. Power of Adjudication of forfeiture goods
The imposition of forefeiture or fines shall be adjudicated according to customs act incase of export and import. And in the case of supply and service it shall be adjudicated by commissioner, where price limit is not applicable and by Government Gazette officer, where price limit is applicable.

In case of forefeited goods the adjudating officer has the right to release that good to the owner after collecting the proper fines. But in case of banned product mouthing shall be applicable.

4.11. Power

The Board, in order to execute VAT Act will be able to appoint person for any place mentioned in the notification for the position of: -

a. Commissioner.
b. Commissioner (Appeal).
c. Additional Commissioner.
d. Joint Commissioner.
e. Deputy Commissioner.
f. Assistant Commissioner.
g. Superintendent or VAT officer

The appointed Officers will utilize their power and perform the responsibilities as per order given by subordinate Officer. The Board will decide the area and conditions, which will fit to the application, power and performance.

4.11. a. Power of VAT officer

The VAT officer has the right to issue summon to any person to investigate their activities for which, the victim is bound to submit all kind of information, document and records as per his demand. When any person is summoned, then he is bound to meet with that officer personally or through a representative.

The VAT officer being empowered by commissioner will have the right to enter any business premises and after giving a notice he can verify stocks, goods, and examine records of the business for which, the victim is bound to cooperate with that vat officer.

The VAT officer has also the power to seize forfeitable goods. And when it is not possible top seize goods; he can give an order not to dispose those goods without his permission. After that a show cause notice will be given to the owner of the goods within two month from the date of forefeiture, stating the reason of forfeiture. In this case the owner will get an opportunity to submit a written statement against that complaint. He can also get an opportunity for personal hearing.

Vat Officer will determine the amounts and realize VAT, Supplementary duty and turnover tax.

There are some assistants of VAT officer who helps VAT Officers in performing their duties. Such as the Police, the Bangladesh Rifles, Bangladesh Coast Guard, the Ansar, and all officers of excise duty, income tax and all office of District or Thana administration.

4.11. b. Power of Board

The board has the power to call for the records and examine documents for the purpose of satisfying itself. Such document includes the record of proceedings, orders passed by vat officer to the government and the legality of the decision. It has also the power of passing orders relating to these facts. But the board has no power to call back the records relating to vat officer after the expiry of two years of the decision. It has also the power to correct the mistake of the records, if any person applied within one month of the order passed. The board has the power to give the right to vat officer to enter in any place, house or vessel. The Board by Government Gazette notification has the right to assign any responsibility of any VAT Officer upon any other Government Officer.

The board can also give the power of right to the vat officer to arrest such a person who has committed any offences under vat law. In this case all kinds of arrest will be conducted as per search and arrest of the code of criminal procedure. When any person is arrested under this act, he shall be sent to vat officer and if the vat officer is not available then he shall have to be sent to the magistrate and then to the nearest officer in charge of police station.

4.11. c. Power of Government

If any registered person made an application to the government against the order passed by the board within 4 month, the government has the right to review that problem if it thinks fit. Such an order includes forefeiture of high priced goods, increase of fine or imposition of fine instead of forefeiture or imposition of fines and tax if it is not imposed. In this regard if the government thinks that the appellant was unable to file an application, then it will allow the applicant to prefer an appeal within next 4 months.

The government has the power to call for the records and examine the record of proceeding within one year from the date of order for the purpose of satisfying itself. It has also the power of correcting mistakes. The Government by Government notification will able to exempt from VAT and Supplementary duty after specifying the reason. . It has also the right to carry out the forfeited goods wherever it wants. But it has no right to pass an order of forefeiture of high price goods or increase fines or imposition of fines against any person without giving any show cause notice.

4.12. Offences and penalties

There are some penalties for breaking the VAT law of the registered person. We can divide the level of offences penalties into 5 parts.

      1. When some one fails to apply for registration, fails to submit any kind of document, falls to change the fact of registration, fails to obey the direction of any summon and violates other provision will be fined 25,000 taka or more.

      2. When any person fails to submit tax certificates, submit false document, attempt to avoid tax through wrong information, fails to protect records, preventing tax officer from entering in the business area, receives tax rebate though among invoice and submit tax certificate without being a registered person will be fined more than one lac taka or shall punished with imprisonment for one year or both.

     3. If any registered servicer fails to submit the document and pay off the vat, then he will have to repay the vat with 2% interest rate.

     4. When any registered person receives notice for two times and fails to repay the vat and supplementary custom or commit any offences for two times or fails to be registered within one month from the date of order, then in the case of registered person his business organization small be locked and registration shall also be locked. And in the case of registrable person his business premises shall be locked.

     5. Vat authority has no right to impose penalties on the victim without giving a reasonable opportunity of being heard. But the exception is the punishment made by the magistrate court.

4.13. Appeal

When any vat officer or any or any person is aggrieved by the decision, they have the proper right to appeal against that decision to the appellate tribunal. In this case if the appeal is made before the commissioner, he has the right to make an investigation and collect information regarding that appeal. He can also give the opportunity of reasonable hearing and can make the change of that decision. If commissioner thinks that the appellant will unable to submit his appeal within 3 months, he can allow him to file an appeal within next 2 months. And if the appeal is made before appellant tribunal, it will dispose the appeal in accordance with the provision of custom act.

If the appeal goes beyond the control of vat officer, the appellant has to deposit the claimed tax or 25% of the imposed fines if it is made to the commissioner and 50% of imposed fines if it is made to the appellant tribunal.

When the board calls for record and document for examination no appeal shall be granted against the decision.

If the appellate authority fails to give any conclusive decision on the appeal within six months of submission of the appeal, then it is deemed that the appeal has been granted by the appellate authority.

5. FINDINGS AND COMMENTS

1. The VAT rate is 15% only for those goods, imported in Bangladesh.

2. There is no VAT on such goods which are sold without packaging. In this case we can take example of Agora dept. store. When we purchase vegetable from market there is no tax but when we purchase the same thing from Agora, it deducts tax at source.

3. There is no VAT on exported goods or services.

4. The National Board of Revenue (NBR) is the central authority for collecting VAT.

5. Any person wishing to start a business is liable for registration. He must give a declaration along with the application for registration detailing the place where taxable goods are manufactured, with a description of the main material used. Only one registration will be enough for the supply of more than one class of taxable goods or services for import or export business if organized in the same place.

6. The Board charged supplementary duty on some luxurious goods, which are not essential and socially undesirable. But only for encouraging the ‘Tourism Business’ government has given permission to some Bonded Warehouse to sale those luxurious goods only to the tourists at a low VAT rate. But some Ware Houses are illegally using this advantage. They are importing those goods in the name of tourists but selling these things in the local market with a high price. For this reason government is losing a huge amount of VAT.

7. The VAT authorized officer calculates the vat from the amount mentioned in the invoices of the assesse. Some fraud businessman does not write invoice properly or sales goods without giving invoice to the customers to avoid vat. In such cases government is losing a huge amount of revenue. In other cases when assesse sales goods in credit and mentions it on the invoice and pays VAT based on that invoice, but sometime some credit amount is not recovered in the future. In such case the assesse faces a great trouble to get back the excess amount of money that he paid as vat.  H/she has to prove the claim to the officer, which is very time consuming.  In such a case government should give some interest to assesse on that amount of money.

8. The government provides the Turn over Tax benefits to encourage some small business mainly the handicraft businesses whose yearly sale not more than 15 lac taka. But some fraud business man uses this advantage by showing low turn over and avoids a huge amount of VAT. In such a case if government become strict and restrict the advantages, then other real handicraft business will be hampered and fall in a big problem.

9. VAT is not charged on taxable supplies made by a business which is not, and is not required to be, registered for VAT. These include loans of money, insurance, certain types of education and training and some property transactions.

10. If some products damaged or destroyed due to accident then the registered person will get tax rebate if he applied within 24 hrs to the VAT office.

11. If any registered person authorized any person directly or indirectly on behalf of him. Then the responsibility for the activity of the representative will be attributing to that registered person.

12. All the documents related to the VAT of any company have to preserve at least six years. Otherwise the company will be penalized.

13. In Bangladesh there is no training institution for VAT officers. For the lack of proper training government lose a hand sum amount of VAT each year. To get rid of it government should establish a training institution for VAT officers, which will help government in recovering of VAT properly.

6. PATHS FORWARDS TO FUTURE RESEARCH

In this project our duty was to summarize the VAT law and highlight the important facts, which we have done with great concentration. The final part of this report was to mention some important facts, which will help the future generation while doing research on this topic. The bonded ware house is the most important facts in this regard. The owners of bonded warehouses are making profit illegally. But the government is unable to find the proper way to restrict them from doing these wrong things. Because of time limitation it was not possible for us to analyze with these things. Probably this suggestion will help the future generation in doing the research process. Another important fact is turnover tax rate. It should be only for small handicraft business. But now-a-days the big handicraft industry like Arong is taking the advantage of turnover tax. Government should restrict them from doing so. Again the future generation will find out the process how to restrict them from this type of illegal business.

7. CONCLUSION

In this report we have discussed about the different criteria of Value Added Tax. Our main job was to summarize the Value Added Tax Law, 1991 and find out different important factors that exist in the law. The time was very short for doing this project properly. So we face some problem while doing this assignment. But we have tried hard to complete this assignment successfully. On the other hand the language of these laws is not suitable for us. So that sometime we became confused in doing the summarization. From the over view we can say that VAT is one of the most important sources of Government income. So as a careful citizen we should pay the vat properly. Still there are some persons who try to avoid vat. In this regard the government should alert in collecting the VAT.