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Well, because we don’t have a VAT, it is, isn’t it? The article puts the blame on the US sales tax system. But regardless, US exporters to the EU end up paying
by surfmike 2y ago
Well, because we don’t have a VAT, it is, isn’t it? The article puts the blame on the US sales tax system. But regardless, US exporters to the EU end up paying more taxes than domestic EU producers.
> Europe’s VATs are not tariffs and are not subsidizing European exports. Instead, US states’ poorly-designed sales taxes are harming their own businesses’ competitiveness—whether they’re selling down the street, across state lines, or around the world.
- misinfo2024 2y ago[dead]
- jakewins 2y agoSorry I don’t follow - how does VAT make US exporters pay more than domestic EU manufacturers? They are both subject to the same VAT, or?
- surfmike 2y agoBecause they are not able to deduct US state sales taxes on business inputs from the final VAT. While Europeans can deduct their local (VAT) taxes on business inputs.
- jakewins 2y agoI still don’t follow. If the VAT was completely removed, US businesses would still pay state sales taxes on inputs and EU manufacturers would not? The two things seem unrelated?
- aredox 2y agoIt doesn't. It has never been. Trump is a liar and a crook and is bullshitting you.
- NewJazz 2y agoFor a VAT to work they have to levy the tax at each stage. Import is a stage... But regardless, US exporters to the EU end up paying more taxes than domestic EU producers. No, because the domestic EU producers are paying VAT at each stage of their production process. The US manufacturers need to catch up!
- kvemkon 2y ago> the domestic EU producers are paying VAT at each stage of their production process. As long as I know, VAT should be payed only once for a finished product when sold to the very end customer.
- Muromec 2y agoNo. The vat is payed by the seller on full price of what they sell. So does their supplier. The trick is -- yoy get tax credits when your supplier is a vat payer. As a result, the tax is collected in parts over the final price sold to the non-business customer. Which is why being a registered one man company with a vat number allows you to get back vat for your laptop
- surfmike 2y agoWe pay sales tax on business inputs as well. But unlike European producers, that tax is not deductible from from the final VAT.
- NewJazz 2y agoSounds like we need our own VAT.
- akoncius 2y ago> But regardless, US exporters to the EU end up paying more taxes than domestic EU producers. but only because of tariffs, not VAT system. we pay VAT regardless from where the good came from.
- tdb7893 2y agoAs an American I don't really deeply understand VAT but I don't get why an American car would pay more overall VAT than a domestically produced car. My impression is that VAT will be the same for items that cost the same, no matter where they are produced.
- stuaxo 2y agoIt will be the same, you were right.
- Muromec 2y agoThe idea behind vat is to spread the sales tax across the chain, which means the government gets the money even if the end product didnt reach the customer. Naturally the chain breaks at the border, so importers pay vat and exporters get vat refunds. In the end its just a sales tax
- bardak 2y agoThe main purpose of VAT is to not fully apply a consumption tax multiple times through manufacturing and distraction
- surfmike 2y agoExactly, and for American producers, sales tax does get applied multiple times and can’t be deducted from VAT
- alexanderchr 2y agoNot true, see for example https://comptroller.texas.gov/taxes/publications/94-124.php https://comptroller.texas.gov/taxes/publications/94-124.php
- aredox 2y agoI don't get why you believe the liars who told you an American car would pay more overall VAT than a domestically produced car. I mean, you are getting lied to your face, by someone who is a serial liar, so why are you trying to find an explanation for something that doesn't exist?
- AndrewDucker 2y agoVAT applies equally to imported goods and locally produced goods.
- smooc 2y agoVAT is applied on every good sold. So no. If you are able to produce cheaper and shipped cheaper than your EU competitor it will be cheaper when a consumer buys it. The consumer pays the VAT, not the producer.
- surfmike 2y agoYour European competitor will be able to deduct all their local VAT taxes on business inputs but you won’t be able to deduct your local sales taxes on your inputs.
- aredox 2y agoAre you dense? The VAT applies to all purchases and doesn't discriminate on where an item is produced. Have Americans become really that dumb?
- devuo 2y agoI think it's more a case of intellectual dishonesty.
- ceejayoz 2y agohttps://www.urbandictionary.com/define.php?term=The%20Rule%20of%20Goats https://www.urbandictionary.com/define.php?term=The%20Rule%2...
- watwut 2y agoYeah and no. I would see intellectual dishonesty as worst and the fact that we did not called it that for years enabled these people. They were giving all possible benefits of the doubt. And calling them dumb is kind of benefit of the doubt.
- School-Cotton 2y ago> Have Americans become really that dumb? It’s not a question of being dumb or not, but rather that VAT doesn’t exist in the US so most people don’t understand how it works, if they have even heard of it at all. Instead of VAT, most states have sales tax, which is similar in spirit but doesn’t work the same way.
- przemub 2y agoLol no.
- Tzk 2y agoYou pay VAT on all products when they’re sold or imported. In Germany it’s 19% and called “Mehrwertsteuer” for the domestic products and “Einfuhrumsatzsteuer” for imported products. There’s an additional Import tax on some products.
- epolanski 2y agoNo both pay the very same amount of taxes.
- wesselbindt 2y agoWhether or not some action is discriminatory is inherent to that action. Something I do can't be considered discriminatory because of what someone else does. So for example, if I shake hands with all people of all colors, you cannot call that discriminatory just because my neighbor doesn't shake hands with people. That would be completely nonsensical. Similarly, if the EU applies VAT to all goods sold, that can't be considered discriminatory just because some other country doesn't apply VAT.
- gamblor956 2y agoNon-European companies don't pay VAT or deal with VAT compliance unless they have sufficient business in Europe that they are required to register for local tax compliance. European customers handle the VAT themselves when dealing with non-VAT-registered non-European suppliers; this is known as the "reverse charge" mechanism and it's generally a feature of almost every VAT system in the world. (In a nutshell, the customer charges themselves VAT and pays it on their own VAT return. This is similar to the way "use tax" works in the U.S.)
- bigbacaloa 2y ago[dead]