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Issues regarding - Value Added Tax (VAT) Or Goods and Services Tax

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Issues regarding - Value Added Tax (VAT) Or Goods and Services Tax

As VAT/GST is known as a mark up percentage on selling price which is transmitted ultimately to final consumer.
Well I have some issues to discuss here -

  1. advantage of VAT registration =
    because as my personal viewpoint
    (Example: Company A has yearly turnover which is slightly below the limit to get registered and Company B has yearly turnover which is slightly crosses the limit to get registered) Where, A and B are competitors - manufacturers in food processing business (use VAT exempt inputs). I guess company A has price advantage in this case where however I want to know if I am right here.

  2. Say company A also exceed turnover limit and both are vat registered. My next issue is company A sets its product price slightly lower then that of product from company B. In turn VAT on product of A is lower from that of B. Then also A has price advantage over B.

  3. Further due to shorter life period of the product A sells products at discount before the products are wasted. However B has rigid price and disposes the products if such case appears. Then, here what should be the VAT on sales of product on discount. Should the VAT be calculated from standard amount or that of from standard amount less discount.

January 21st 2015 AN ACCA USER 8,730 Points

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