Question

what is the formula of sales tax or vat class 8 cbse

Answer 1

VAT stands for value added tax

By the way, VAT IS GONE and replaced by GST


VAT =tax charged - tax paid.
VAT =tax%(SP-CP)

Sp is selling price excluding tax and cp is cost price excluding tax

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Answer 2

Total Sales Tax = Cost of item × Sales tax rate.

VAT = Initial Price × VAT%

• Sales tax is relatively similar to VAT, with the key distinction being that sales tax is analyzed only once at the ultimate stage of the purchase. Unlike VAT, which is analyzed at each stage of purchase or production and spent by every consecutive buyer, sales tax is paid only once by the last consumer.
• A main advantage of VAT over sales tax is that the former can allot the tax amount to distinct stages at production founded on the value added at that stage. Since sales tax is just paid once by the last buyer, one cannot estimate the value added at each production stage. It makes it tough to track and allot the sales tax to particular stages of production.

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