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VAT in India is of 2 types
1. Central Level VAT called CENVAT (Central Value Added Tax)
- State Level VAT (Different VAT for each states. For example Delhi Value Added Tax Act (DVAT) in Delhi.
Difference between CENVAT and VAT
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CENVAT |
VAT |
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It is imposed by Central Government |
It is imposed by State Government |
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Same rates are applicable through out India |
Rates may be different for different states |
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It contains of input of Excise Service Tax |
It contains input of only VAT (tax on sale of goods within state) |
Adjustment of CENVAT with VAT and vice versa is not allowed
What was MODVAT?
The old name of Cenvat was MODVAT(Modified Value Added Tax Act)
MODVAT was introduced in 1986 but later its name was changed to CENVAT in 2000
