Value Added Tax (VAT) is a type of consumption tax imposed on goods and services at various stages of production and distribution. It is an indirect tax that is applied based on the value added at each stage of the supply chain. Businesses collect VAT on their sales and remit it to the government, with the tax ultimately borne by the end consumer. VAT is included in the cost of the product or service, and the amount paid by the customer reflects the cumulative tax from all previous stages. VAT provides a significant source of revenue for governments and is commonly used worldwide as a means of taxation, contributing to public finances and funding government programs and services.

Read More:

Logistics 101: What is Commercial Invoice | FreightAmigo