Explain in numbered paragraph the case for and against VAT in your country

The case for VAT in Kenya is:

  • Easy to administer since the seller of good or service becomes the collection agent.
  • It allows for the canon of productivity since more goods and services can be subject to VAT
  • to increase revenue to the government.
  • It is difficult to evade since it is charged on selling price.
  • It does not have a cascading effect i.e no tax is charged on tax.

The case against VAT

  • It is complicated for most traders and requires many records to be maintained.
  • If charged on basic commodities, hence it falls heavily on the poor and may not be equitable.
  • Not convenient for most taxpayers e.g it has to be paid by 20th day of the following month
  • even where the trader made a credit sale and has not received cash.
  • It could have inflationary effects since it will lead to increase in commodity prices.
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