Page 1 - 2
P. 1

SAI International School
                                                        CLASS - VIII

                  Mathematics
                  CHAPTER-8: Comparing Quantities

                  Lesson Notes




                  SUBTOPICS:VARIOUS  KINDS OF TAX,SALE TAX, VAT,GST



                  WHY TAX??


                  The government of every country needs money the following:

                  (i) to meet their administrative expenses,

                  (ii) to execute social welfare and development schemes,

                  (ii) to meet the expenses on salaries of its employees, etc.

                  One of the many sources of collecting money (revenue) by the Government from the citizen
                  on the sale of goods within their respective territories. This purpose is known as sales tax.


                  ST(Sales Tax) , VAT(Value added Tax),:
                  Sales Tax and Value Added Tax

                  Sales tax or value added tax(VAT) is the tax that should be paid to the
                  government on sale of an itemand it is added to the bill amount.
                  Normally, VAT is included in the price of items like groceries.

                  Finding Sales Tax / VAT

                  Sales tax or VAT =  Tax % of  Selling price

                  Billing Amount = Selling price + VAT

                  Example1 : Megha bought a wrist watch for Rs 1,200 and VAT is charged at 8%.
                  Calculate the VAT and billing amount.

                  Solution : VAT = Tax % of selling price
                              VAT = 8% of 1,200=8/100×1200=Rs 96
                              Billing amount = S.P + VAT = Rs 1,200 + Rs 96 = Rs 1296.

                                                                1
   1   2