Value added tax (VAT) may be a sort of tax that's imposed on goods and services. Sometimes, when the govt operates on a budget surplus or wants to extend its revenue so as to finance its deficit . an issue that arises is whether or not value added tax has been a boon or misery for a developing country like India. Around 136 countries in Asia have recognized the importance useful added tax. In one among the foremost large scale reforms of the country’s public finances in over the past 50 years, India has finally agreed the launch of its much delayed value added tax from 1st April, 2005 at a rate of 12.5%. The rate is fixed by meeting of various state level minister of finance , in New Delhi , designed to form accounting more transparent, to chop short trade barriers and boost tax revenues. the govt imposes taxes and duty charges on the guy people for fulfilling the infrastructural, technological, entrepreneurial demand of the country. VAT is omnipresent altogether goods and services provided to the buyer . The paper aims at presenting the importance useful added tax within the Indian society, its impact and therefore the future prospect for product and repair industry in India. the info collected is secondary based from the governmental publications and standard for chartered accountants.