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Apple includes the VAT in the selling price of its products. Therefore it isn't correct to view it as Apple paying the VAT. The purchaser pays the VAT. Apple
by skh 8y ago
Apple includes the VAT in the selling price of its products. Therefore it isn't correct to view it as Apple paying the VAT. The purchaser pays the VAT. Apple just collects it and passes that payment along to the taxing authority. Apple also doesn't pay the income tax of its employees. What Apple pays its employees are expenses and and therefore are deducted from its income. Apple pays tax on profits and not on its business expenses.
- leetcrew 8y agoit's somewhat pointless to look at who pays taxes at the surface level. depending on market power, the actual burden of the tax can shift dramatically between buyer and seller. it has almost nothing to do with who officially pays the tax. see https://en.wikipedia.org/wiki/Tax_incidence https://en.wikipedia.org/wiki/Tax_incidence
- skh 8y agoI’m not an economist. It seems to me that while the VAT on Apple’s products affect the supply/demand for those products it is best to view the VAT as something paid by the consumer. Do you know if this is wrong? This is my intuition but since I’m not an economist my intuition doens’t count for much.