Problems and proposed solutions in the return of Value Added Tax in transactions on discount rates, accountintg

Value of Added Tax Rate is the most developed and modern in turn over tax. Value of Added Tax Rate is a non-cumulative turn over tax. Because of this quality the tax leads to a pyramid-shaped incident. The quality that makes VAT different from similar turn over taxes is it's mechanism for tax discounts. This discount mechanism is implemented by calculating VAT on sales to calculating VAT on purchases. The main problem encountered within the application of this mechanism is the reduction of the rate of VAT on the delivery of goods and discharge of services. When the rate of VAT is reduced taxpayer's VAT collection is decreased. Taxpayers who have to pay more VAT than they collect to continue their business activities face a growing circulation of VAT problem and charge and VATs that can't be compensated through discounts need to be returned. In this regard, in article 29/2 of the Value of Added Tax Law No.3065, the taxpayers with reduced VAT rate on goods and services have the right to receive refunds in order to compensate for the miscalculated VAT rate due to discounts. In this work, after a wide briefing on VAT, tax returns methods and tax returns explained according to transaction types, discount rates on VAT returns, we have prepared a sample to make the subject more perceptible, the discount rate on VAT returns and problems encountered in accounting and solutions on solving these problems. KEYWORDS: VAT, VAT returns, charges on VAT, discount rates