GST(Goods and Service Tax)
VS
(Value Added Tax)
Brief Summary of Both the Taxation
Policy

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

After the introduction of GST, indirect taxation policy of
India will be subsumed under GST because a line of
various taxes will be included in a single tax law which is
GST (Goods and Service Tax).
Before GST, the main indirect taxations were VAT,
Service Tax, Excise etc.
Where VAT is a tax which is added at every point, from
production to the time of sale.
Tax is added at every stage when the value is added that
is why it is called value added tax.
Return to be Filed

Under the GST, taxable person will be expected to file the details of
all the sales electronically by 10th day of each month in GSTR-1
succeeding the taxable month and later on by the mid of month he
will have to file the details of all the purchases in GSTR-2
succeeding the taxable month And annual return should be filed up
to 31st December in GSTR- 8 of next financial year.

Although In present VAT system the dealer has to file quarterly VAT
returns and at the same time assessee has to file Sales register
and purchase register. And at the end of the year, the assessee is
liable to file annual return too.
Input Tax Credit
 After
the introduction of GST Law, this cascading
impact will be eliminated because in GST we can
get Cenvat Credit of interstate sales purchase as
well as in GST we can get credit even after sales
of Services.
 While
under VAT system tax credit for CST cannot
be taken against VAT payable so it leads to
cascading effect i.e. tax on tax.
Cost Reduction
 The
implication of GST law will ultimately result in cost
reduction of goods as there will be a single tax levied that
is goods and service tax.
 While
under VAT law a trader cannot use the credit of other
indirect taxes similar service tax credit etc. For payment of
VAT liability so it will result in a rise in the value of goods.
Tax on Interstate Sales

Under GST law IGST will be levied in case of interstate sale and purchases.

While under VAT Law CST is levied on inter-state
purchase and sales of goods.
Input Tax Credit Mismatch

According to GST law the biggest problem of ITC mismatch will
get solved as all the details of sales will be filed till the 10th day
of next month and all the details of purchases will be filed by
15th of next month and monthly return will be filed by 20th of
next month.

While under VAT system there is a very big problem of ITC
mismatch as there is no such system for filing details of sales
and purchase by few specified date before filing the VAT return
which gives increase to Input tax credit mismatch.
Conclusion

In my opinion GST will be a probable solution for
different problems in VAT and other taxation
structures.
Read More @ Diifference between VAT and GST
The Team