Is Value Added Tax (VAT) a direct or indirect tax? Explain

Value Added Tax (VAT) is a multi-stage indirect tax based on the expenditures of individuals as well as legal persons and services on taxable goods and services charged and collected by traders/businessmen acting as agents to the taxing authority. Registered persons are required to charge output VAT on Sales made of taxable goods and services and to recover input VAT charged on purchases they made such that the final consumer
bears the final burden of the tax.

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