VAT : Difference Between Zero Rated Supply and Exempt Supply
VAT Zero Rated Supply
There is no output tax is chargeable on a zero rated supply ( since the tax rate chargeable is 0%) .However, input tax attributable the making of a zero-rated supply is recoverable from the General Department of Taxation (GDT) as an input tax credit.
Example
- Supplies involving the export of goods and services,
- Supplies involving the export of services,
- the provision of international transport services etc.
VAT Exempt Supply
Input tax attributable to the making of an exempt supply is generally not recoverable as an input tax credit.
is exempt VAT.
Example
- Public postal services,
- Hospital, clinic, medical and dental services and the sale of medical and dental goods incidental to the performance of such services,
- The provision of financial services etc.