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The cost of doing business will increase. Prices of goods and services will increase. The impact of increased prices is to be borne by final consumer. unfortunately it will be a big challenge, the consumer behavior may change accordingly with.
accountants with the VAT tax experience will be highly demanded
The cost of doing business will increase. Prices of goods and services will increase. The impact of increased prices is to be borne by final consumer.
Industry will face following challanges:
Purely from an accounting functional point of view, It is advised for accounting professionals to familiarise themselves with the VAT legislation in your region. Accounting professionals need to be aware of the allowable and disallowable VAT applicable to goods/services as this dictates what output tax a business has to declare or how much input tax a business can claim back from the tax office in your respective country.
It is also important that people in data entry functions within accounts department, log invoices etc against the right ledger codes. For instance, logging a disallowable expense (for VAT purposes) against an allowable ledger code will result in under-declared net VAT to the tax authority. This could cause serious issues if errors build up over time. I hope this is useful.
Due to implication of5% VAT the cost of the goods increases for the final consumers but in any way it does not affect the business enterprises as they can take the set off for the same against output vat liability. However it can affect those business whose cost of goods sales are more and due to vat compulsory charge, the cost also increases which give negative remark for the users of company product as it will be expensive for them. But in accounting term it does not make much difference because one way it is paid and other way it is adjusted against liabilty
