{"id":1902,"date":"2020-07-29T11:10:46","date_gmt":"2020-07-29T05:40:46","guid":{"rendered":"https:\/\/chatterdc.com\/?p=1902"},"modified":"2020-07-29T11:21:15","modified_gmt":"2020-07-29T05:51:15","slug":"all-about-sales-tax-and-its-calculation","status":"publish","type":"post","link":"https:\/\/chatterdc.com\/all-about-sales-tax-and-its-calculation\/","title":{"rendered":"All about Sales tax and its calculation"},"content":{"rendered":"

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The taxation system is one of the most ancient oldest systems. It is compulsory to pay a certain amount of money to the governing body of the nation based on the earning of an individual. This tax payment helps in development of the infrastructures and many more public services because of the public interest. Everything that we buy from groceries to garment or electronic appliances all of this involves a certain amount of tax. All the class of taxes that we know about falls in two types that is a direct tax and indirect tax. Some of the tax that we pay directly to the government like the income tax, corporate tax or wealth tax etc all comes under the category of direct tax. The indirect tax involve sales tax, service tax etc are taxes that can be paid indirectly. A better way to understand direct tax is that this tax is paid directly and cannot send or transferred to any other person, whereas indirect tax is different from direct tax in this the tax are played indirectly and the tax are imposed on a product.<\/p>\n

What is sales tax?<\/strong><\/p>\n

Sales tax is imposed on the sales of a certain product or services. Defining it broadly we can say the tax that is imposed on the end consumer are sales tax for example if farmer is selling his product to a wholesaler the wholesaler has to get a resell certification to proof he is not the end consumer then the retailer buys the product and he has to go through the same process to get the certification finally he sales the vegetable in the market to the consumer and the sales tax is applied to the final consumer.<\/p>\n

Types of sales tax<\/strong><\/p>\n

Sales tax can be further categorised into two types the first one is the retail or consumption tax and the second is value added tax.<\/p>\n

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  1. Consumption tax: <\/strong>it is a traditional form of sales tax. A percentage tax placed on the sale of the good.<\/li>\n
  2. Value added tax:<\/strong> the tax amount is decided on the difference between the sales price and input cost of the product for example if a retailer buys a product in twenty rupee and sales it in thirty rupee price the difference of ten rupee is the net tax is calculated in the 10 rupee difference.<\/li>\n<\/ol>\n

    Advantages of sales tax<\/strong><\/p>\n

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