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As 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 impressi
by tdb7893 2y ago
As 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?
- surfmike 2y agoEuropean producers can deduct VAT on their intermediate business inputs, but American producers can’t deduct the sales taxes on their intermediate inputs.