Talk:Value-added tax/Archive 2

black market?
Something should be said on wether or not large black markets turn up in countries that have a VAT. I personally have always wondered about that. you would think a 20% increase on everything would make people look elsewhere. -Tracer9999 (talk) 00:11, 11 May 2010 (UTC)


 * This is just opinion but: I thought about that too, but then I realized - unless you went out into the wilderness and gathered lumber or minerals from nature ONLY when you made this black-market item, the VAT would deter a black market completely. Remember, business' expenses that get taxed via VAT are recovered if they go towards making a product to be sold; a black market would have to pay the VAT on operating expenses because an underground operation cannot file to recover VAT, by definition of "underground". -- Again, there are ways around it, but it would take extensive efforts of bare-resource harvesting (or any extra-marketal actions) to avoid the VAT altogether to hold together cost-reduced underground marketing.
 * However, that is just a thought-experiment, completely unsourced, and merely a comment based on my spherical-opinion worldview. I believe if such articles exist documenting a black-market uprising or quashing due to VAT, it should be included into the Article post-haste! Bullercruz1 (talk) 11:43, 10 December 2010 (UTC)

The Sum and Substance of the Following Should Be Added (sans editorializing): the Article Is Misleading Otherwise
This is, of course, all theory. In practice a retailer specializes in sales to consumers. Retailers tend to sell a large variety of products and have enough on hand for their trade until the next supply shipment comes in, but not enough on hand, for example, to sell 100,000 widgets to one customer. In another example, for clarification, a consumer cannot wander into a grocery store and make a point-of-sale purchase for 10,000 rolls of toilet paper. On the other hand, there is nothing to prevent a nonconsumer from avoiding tax at "retail" establishments that cater to both consumers and non-end-users. However the burden is on the non-end-users to provide the business license, exemption certificate, etc., necessary for exemption from sales taxes ordinarily collected by the retail establishment. A large exception to this state of affairs which is growing exponentially is online sales. Typically if the online retail firm has no "presence" in the state where the merchandise will be delivered, no obligation is imposed upon the retailer to collect sales taxes from "out-of-state" purchasers. Generally, state law requires that the purchaser report such purchases to the state taxing authority and pay the sales tax. It is fair to say that many citizens are unaware of this obligation and that states make little effort to raise that awareness or provide a reasonably easy way of complying with the obligation.

No one expects this happy state of affairs to last forever. Amazon has been targeted. so far it has responded on a case-by-case basis. Colorado has recently attempted to to require Amazon to remit sales taxes on sales by Colorado-based "affiliates." Amazon preemptively cut ties with those affiliates. Finally, it is widely believed that a value-added-tax is unlikely to be enacted in the United States because most consumers would not understand understand such a tax – it is too complicated compared to the sales tax. —Preceding unsigned comment added by 76.14.135.111 (talk) 02:28, 20 October 2010 (UTC)
 * Fascinating really, now do you have a reliable source you'd like to site or is this just a personal forum? Bullercruz1 (talk) 11:38, 10 December 2010 (UTC)

VAT included or excluded in retail display pricing
Which countries generally include VAT in the display pricing of consummables?

For example, most European countries include VAT in display pricing but in some countries (I'm talking here specifically about Canada with HST) do not; i.e. 'on shelf' pricing excludes HST which is subsequently added at time of payment.

It would be useful to include a column within the existing tables to show which countries include or exclude Vat in display pricing

Viridiana2 (talk) 00:23, 4 November 2010 (UTC)


 * I think such a column would be unnecessary, and would clutter the otherwise informative tables. At any rate, as I understand it, HST is a sales tax, which are generally not included in the "on-shelf" price; VAT is always included in the sales price as it is a tax on the value added at each stage of production.  Sales tax is only levied on sales to private consumers.  ConorBrady.ie  (caint)  09:29, 4 November 2010 (UTC)

Sorry ConorBrady, HST is a form of VAT. (I only mentioned HST as it is currently a political 'hot potato' here in Canada.) I take your point about extra columns cluttering the tables but I still think it would be useful to identify which countries generally include or exclude VAT in retail display pricing. —Preceding unsigned comment added by Viridiana2 (talk • contribs) 21:33, 4 November 2010 (UTC)


 * Excuse my comment that HST is not a value added tax. Are there any other countries that have a VAT which isn't included in the shelf price?  My experience may be Euro-centric, but any VATs I've come across are always included in the shelf price. Canada is the only exception I now know of, so the current setup of there being a note in the relevant section should suffice.  ConorBrady.ie  (caint)  22:20, 4 November 2010 (UTC)


 * Viridiana, ConorBrady
 * My understanding is that we have these two questions for each country that uses a consumption tax:
 * (Q1) TYPE OF CONSUMPTION TAX -- Is the consumption tax
 * (a) "VAT", or
 * (b) "sales tax"?
 * (Q2) SHELF PRICING PRACTICE: Is the consumption tax included in the shelf price?
 * (a) "yes", or
 * (b) "no"
 * and that
 * these two questions are logically independent of each other, but
 * presently, in countries where
 * the answer to Q1 is (a) VAT,
 * the answer to Q2 is usually (a) "yes" and
 * the answer to Q1 is (b) sales tax,
 * the answer to Q2 is usually (b) "no"


 * Is my understanding correct?
 * Mark.camp (talk) 02:17, 1 December 2010 (UTC)


 * @Mark.camp:
 * Yes, you're correct. (I like the logic table, btw!)  As such, only the anomalies need be noted, IMO.  ConorBrady.ie  (caint)  23:36, 5 December 2010 (UTC)

More about the history of the VAT is needed
It started in 1954, but how exactly was it introduced? How come that just like that, the masses of people around the world accepted the VAT as part of their reality? Was the VAT percentage very low at the start and then increased incrementally? The article seems to neglect or avoid these "tough" questions. John Hyams (talk) 00:29, 16 December 2010 (UTC)

"the value-added tax is in fact a proportional tax in that people with higher income pay more at the same rate that they consume more." - in the article. This of course is correct up to a point but in includes a lot of assumptions and omissions. IE If I am rich I may buy 2 sodas instead of 1, so I pay twice as much. However, I earn $100 for every $1 you earn. So if sodas cost $1 and tax is 10 cents then you pay $1.10 and I pay $2.20. Of course you had to borrow 10 cents and I have $97.80 left I my pocket that isn't taxed - sucker! You'll pay 10% tax and I'll pay 0.2% tax, you gotta love this new system. It's pretty darn close to what we have already. ( If I lent you the 10 cents at 7% for 30 years you will pay me back 30 cents - I can claim a business expense ( I hope this is in VAT and lower my "socialist tax rate" of 0.2% down to 0.195% and of course you will probably not be able to buy soda for twenty years at such a good interest rate unless dancing girls can influence you "that life is for living" - sucker!15:37, 3 February 2011 (UTC) —Preceding unsigned comment added by 159.105.80.220 (talk)

Distortionary / Economic Section
What has been written is generally true, but is also a generalisation!

In general price increases reduce demand. The demand for some goods can go up as a result of higher pricing (the snob effect) or remain equal - necessity goods.

What should be noted is Value-Added Tax is recessive, and thus is often not the best tax. Also, despite not implicitly affecting production it is a deterrent to employment and working to achieve extra money as with the application of tax on goods purchased it removes the incentive to some degree of people working as they are able to purchase less with money earned.

If someone has the time these points should be made, or the comment of the author of this section counterbalanced. Or the use of 'generally' inserted afore a number of statements.

Lastly, I work in the field but the author hasn't really defined what they mean by distortionary - jargon used by the likes of the IMF. Gavin AD (talk) 14:33, 13 May 2011 (UTC)

Ultimately, VAT is an immoral tax. The state which plays no direct part in the production of goods and services charges the consumer an extortionate amount compared to the amount people who do the work earn in producing these goods and services. 86.162.140.99 (talk) 12:55, 17 May 2012 (UTC)

History of VAT
I believe that the first historical mention of VAT, was in fact in France in a novel by Balzac, called "The employees" or "the superior woman" (litteral transalation...). In this novel published in 1883, one of the main characters, if ot the main one, Xavier Rabourdin, pursues a life long "invention" which consists of taxig consumption rather than income, under the idea that it would reduce taxation levels on the individuals and yet increase return for the administration. — Preceding unsigned comment added by 147.67.18.5 (talk) 08:33, 12 October 2011 (UTC)
 * In the German article it is said that a VAT has been established nationwide in 1902 (and earlier, e.g. in Bremen 1863, and even before the proposal by Siemens's mentioned in thsi article), and was also used in ancient Rome. So Lauré can't have "invented it".--Mideal (talk) 11:48, 10 November 2011 (UTC)

A List of countries and territories without VAT would help assess its global extent
It would add fuel to the case of the scepticals about VAT efficiency as the list enjoy descent economic prospects in a context of global economic crisis.

It could be a standard country table that don't need to be sortable if grouped by independant or territory criteria.

Then I feel one table would be easier to handle than the three we actually have, provide it is initially sorted by regions e.g. Africa, Asia, Meeddle-East, Europe, America and Pacific with all the countries and territories of the world. The no VAT countries will have simply zero on rate columns. It would need one more column to include the region for enhanced sorting purpose. By the way incorporating the fifty or so countries that are missing in the non-EU table. Might do it next week if there is no objection.

Galafron (talk) 03:57, 4 November 2011 (UTC)

State Sales Tax vs. State VAT and online sales?
At the end of the sales tax example the article states that online sellers without a presence in a state don't pay the state sales tax. Why is this only listed under the state sales tax example and not the VAT example? How would this be different in a VAT situation? If I'm a manufacturer in No-tax-state, selling online and a consumer buys my widget for $1 from VAT-tax-state why would I, as a manufacturer, be required to collect VAT? Why would a VAT change the consumer's actions after buying my widget? I don't see why this is called out in the sales tax example but not the VAT example. (Of course, this is assuming a situation where the US states switch from a straight sales tax to a VAT, so separation of state jurisdiction and lack of interoperability at least equivalent to the current level is assumed. I don't know the state of affairs in other countries and whether sales tax dodging through online purchases happens there or not.) 207.190.221.98 (talk) 21:23, 11 November 2011 (UTC)

VAT, gross value and net value
Could someone explain a bit the terminology about Gross Value, Net Value and VAT and how they are are related?

I believe that

Gross value being the price paid by the client. Net value the money received by the supplier. and VAT is the difference going to the tax office.

Gross Value = Net Value + VAT

Am I right?

It sounds simple but we many reader are not native English speakers. — Preceding unsigned comment added by 82.152.196.122 (talk) 23:15, 15 July 2006 (UTC)

Should this be someone or something
Because the price for someone rises, the quantity of goods traded decreases

Yes I agree this is a very minor point. — Preceding unsigned comment added by 64.48.59.4 (talk) 14:42, 20 July 2006 (UTC)

Disputed
(See the section below, Rules on pricing within the EU; if clicking on that link doesn't lead to the respective section, it means that section has been archived either here or here.) —Preceding unsigned comment added by Gutza  (talk • contribs)  23:16, 7 July 2007  (UTC)

fixed now! —Preceding unsigned comment added by 194.46.232.120 (talk 01:09, 28 July 2007 (UTC)

Indonesia GST
I've seen it written elsewhere that Indonesia has a 10% GST. Can anyone confirm this and if so, add it to the list —Preceding unsigned comment added by Starstylers (talk • contribs)   15:27, 15 July 2008 (UTC)

Border Tax Equity Act.
>> Manufacturers in the United States are at a great competitive disadvantage to foreign manufacturers ...

WFT? I understand that Wiki simply reference external ATMAC position, but it will be fair to include alternative viewpoints, e.g. the position of World Trade Organization.

Let me explain. Suppose you have three manufacturers, Company A (USA), Company B (France) and Company C (Sweden). Suppose that all three companies make competing versions of same good, X. Suppose that this good cost 90$ to manufacture for all companies, excluding either VAT or Sales Tax. Suppose that this good also requires 10$ of expenses to sell it (retail expenses and income, logistics, etc.), so overall cost of a good to retail shop is 100$. Suppose that Sales Tax in USA for retail shop is 10%, VAT in France is 20%, VAT in Sweden is 25%.

Now let's see what will happen without VAT rebate practice. If you've read the article, you already know that regardless of anything, Company B will be taxed by 20% x 90$ = 18$ and company C will be taxed by 25% x 90$ = 27$, so they'll have to sell their goods for 108$ and 117$ respectively. I will assume that goods can be shipped worldwide with nearly same cost to make example more clear to see.


 * 1) Suppose now you have a retail shop in USA. Goods from A will cost 90$ to buy, goods from B will cost 108$ to buy, goods from C will cost 117$ to buy. We will also have to spend 10$ of own expenses and pay 10% sales tax. This will give us sale price for good A to be 111$ (100$ costs + 11$ taxes paid in USA), sale price for good B to be 131$ (100$ costs + 18$ VAT paid in France + 13$ sales tax paid in USA), sale price for good C to be 141$ (100$ costs + 27$ VAT paid in Sweden + 14$ sale tax paid in USA). Let me remind you that manufacturing costs (including salaries, income taxes etc. - everything) for all three goods to be exactly the same 100$. But in retail shop goods from A cost 108$, goods from B costs 131$, goods from C cost 151$.
 * 2) If you don't think that's bad, now take a look at retail shop in Germany. Imports from USA are not subject to Sales Tax in USA, but subject to VAT tax in Germany. Importer of 90$ good from company A will have to pay same 90$ x 20% = 18$ as manufacturer B pays, so goods both from A and B will cost 108$ to buyer in Germany. Unfortunately goods from C will be subject for VAT taxes both in Germany and Sweden, so they will be taxed 27$ in Sweden and additional 117 x 20% = 23.4$ in Germany, resulting in cost of 130.4$. Additional 2$ of VAT will be taken from 10$ cost of retail sale, resulting in following retail prices: goods from A cost 120$, goods from B cost 120$, goods from C cost 142.4$
 * 3) Repeating these calculations for retail shop in Sweden, we'll see retail prices of 125$ for goods from A and C and 147$ for goods from B

Now we can see two interesting properties:
 * 1) Goods with same production costs are taxed & prices completely differently in different countries
 * 2) Goods from Europe are sold in USA at prices higher even than in Europe (where taxes are higher) and much higher than prices for US-produced goods

That isn't what's called a "fair competition" by World Trade Organization. Some goods are *being taxed twice* in this scheme, with most benefits going to US goods. And that's why WTC recommend a different taxation method, where VAT is refunded for all exported goods. With VAT refund,


 * 1) Suppose you again in retail shop in USA. Goods from A still cost 90$. Goods from B will normally cost 108$ to buy in France, but B will get 18$ refund for export, so it sells it's goods to USA for 90$ too. Goods from C cost 117$ in Sweden, but with 27$ refund they will be available for 90$ in USA. Then retail shop adds own 10$ to price and pays a 11$ sales tax. Now retail price for goods from either A, B, C is 111$, with 11$ of taxes paid in each case to US
 * 2) Suppose you are in retail shop in France. Goods from A cost 90$ + 18$ of VAT are paid by importer, 108$ total. Goods from B costs 108$ (18$ of VAT is paid by manufacturer). Goods from C will normally cost 117$ in Sweden, but with 27$ refund it will be 90$ for same goods imported to France. France will tax importer with its own VAT tax on these 90$, resulting in same 108$ cost of good C. With additional 10$ of retail shop expenses and 2$ of VAT, retail prices will be 120$ for goods from either A, B or C, with 20$ of taxes paid in each case to France
 * 3) In Sweden, goods from all three companies will cost 125$, with 25$ of taxes paid to Sweden

You can easily see a fair competition, reasonable prices, and no double-taxation. No surprise that this is the common scheme adopted in vast majority of the world and recommended by WTC. And that's what is called "great competitive disadvantage for US companies" by ATMAC who wants European companies to pay taxes twice for their exported goods, and US companies to avoid any taxes at all for goods they export.

Nice, huh? I suppose to change an article to more neutral description of VAT export mechanics.

91.79.77.61 (talk) 15:20, 31 March 2012 (UTC)

Germany
Germanys VAT is just 19%, mentioned correctly in the article, but incorrectly in the example section.

- http://en.wikipedia.org/wiki/Value_added_tax#Example

80.187.201.110 (talk) 17:42, 23 November 2012 (UTC)

Why a Robert J. Samuelson reference under US Section?
While reading through this article for the first time, I noticed a reference to an article by Robert J. Samuelson that I take issue with. The piece is a very short news article that doesn't cite sources for numbers, that has out-of-date figures, and is simply a piss-poor analysis, more assertion than controlled, econometric study. I see no reason to reference his piece on VAT in the US. If commentary on VAT in the US is desired by readers, they would be better served directed to scholarly work, not shoddy journalism. I urge editors to remove the sentence and the link (17).

16/07/2013 3:40PM

-Jeff Smith — Preceding unsigned comment added by 71.0.82.131 (talk) 19:45, 16 July 2013 (UTC)

Assuming end user price (EUP)/sale price is fixed and VAT is added to it
Consider the sales terms "EUP=x +local taxes as applicable"

I think the statement" From that of the seller, it is a tax only on the value added to a product, material, or service, from an accounting point of view, by this stage of its manufacture or distribution" should be rephrased.

Company A procures raw material for 112.5 (100 + 12.5% VAT) from M

Company A sells the item for 200, end user price being 225 units of money.

With VAT the item sells for 225, and the company A keeps 12.5 from it (M's VAT) and pays 12.5 to the Govt. The company has essentially retained 100 units of money.

However, the company has added a value of 87.5, so its value added tax should be 10.93 giving an end user price of 210.93 effectively.

If the objective is to tax the margin added by each contributor in the food chain, VAT at EUP seems to increase the costs. Is it mandatory all over the word that the company A has to claim back the extra 12.5 that M has added? Can A not say that "My value addition is just 87.5 and I will pay VAT only on my component and not claim M's component"? Is it mandatory that the EUP has to be subject to VAT of the entire chain and not that of each seller?

In that case my understanding is that VAT is similar to sales tax, where the EUP has a tax component and not "just taxing the margin/value added", it just gives A an incentive to ensure that it tracks M's tax components?" — Preceding unsigned comment added by 122.178.239.2 (talk) 06:42, 9 October 2013 (UTC)

Value added tax
Ghana'e VAT rate, as of Jan. 1, 2014, is 15% (not 13% as shown). This value does not include the National Health Insurance Levy (NHIL of 2.5%), which is being assesed in addition, bringing the total levy (VAT + NHIL) to 17.5%. — Preceding unsigned comment added by Johnalbrecht (talk • contribs) 16:57, 7 January 2014 (UTC)

Bahamas to start using vat tax
http://www.tax-news.com/news/Bahamas_To_Introduce_Value_Added_Tax____59784.html Why is this happening? — Preceding unsigned comment added by Theeastlincolntimes (talk • contribs) 16:06, 4 February 2014 (UTC)

Error: A VAT is like a sales tax in that ultimately only the end consumer is taxed
This is incorrect. Companies are taxed on the value they add to a product. Hence, if I am a German company selling in to the UK I pay the German government rate of VAT for the value I add to my product, rather than paying sales tax to the UK government on behalf of the UK based purchaser. This is the biggest difference between a sales tax and VAT.

— Right, few times in the article mentioned phrase "end consumer is taxed" is not correct. In market price is optimized and no tax can be directly' shifted forward to a consumer. "Tax has been shifted backwards to original factor returns. No longer does every original factor of production earn its discounted marginal value product. Now, original factors earn less than their DMVPs"; and whole chapter (5) "Is a Tax on Consumption Possible?"

Peges: 110., 113., 134. http://library.mises.org/books/Murray%20N%20Rothbard/Power%20and%20Market%20Government%20and%20the%20Economy.pdf --Savo Gajic (talk) 16:31, 12 April 2014 (UTC)

Americas VAT Free Status
Is it fair to have the USA in the VAT free column. Most states do have VAT. There are other countries with VAT free areas such as China and the UK, putting the USA in there seems a bit unfair if not inaccurate. Jamesrules90 (talk) 17:05, 8 January 2013 (UTC)

The US has never had VAT to my understanding, and the states set their own sales taxes which can be 4%-10% depending on the state right now. — Preceding unsigned comment added by 75.187.116.238 (talk) 02:53, 10 March 2013 (UTC)

Furthermore, US sales taxes (where levied) is only levied on retail to end consumer. Retail organisations who buy goods for resale typically apply for an exemption certificate which allows the supplier/manufacturer to omit the collection of sales tax (on their invoices). If the US operated a VAT environment the tax would be collected on the sale price at each stage of the supply chain (simplistically) --193.35.254.235 (talk) 15:17, 15 July 2015 (UTC)

UK VAT quirks not fully represented
Various UK VAT quirks not fully represented but would add significant complexity to the article. Also not fully attributed back to reference website.

--193.35.250.233 (talk) 15:26, 15 July 2015 (UTC)
 * Distinction between Zero rated and Exempt. Both are effectively 0% but VAT on the costs used to create an exempt item can't be handled as input VAT and reclaimed (I think).
 * Royal Mail letter post (including small parcels) is Exempt to all destinations including international (I think, could be Zero), but other carriers (including Parcelforce which is owned by Royal Mail) are standard rated when bought standalone (e.g. for personal use), and will be composite rated (aligned to weighted rate of goods shipped) if essential to the supply of goods (e.g. ecommerce deliveries).
 * In certain cases Charities can reclaim VAT (I think)

Missing Trader Fraud/Carousel Fraud and EU processes to deter this fraud
Within the EU, there has been a common fraud regarding the reclaim of Input VAT usually on cross-border sales

Missing_trader_fraud

To defend against this within the UK (main victim country for this fraud), certain products have to have their VAT remitted by the recipient rather than the supplier. --193.35.250.233 (talk) 15:33, 15 July 2015 (UTC)

Cross Border trade and registration requirements in EU
This needs adding to main article but I don't have time to reference properly

Generally, VAT is not levied when a product is exported.

However, cross border trade within the EU is usually liable for VAT. The rate and the country which benefits varies
 * If the supplier does a small amount of trade across borders to a destination country, they are allowed to charge rate at origin and remit to origin tax authorities, and don't have to register in destination country.
 * If the supplier does a significant amount of trade to a specific destination (amount varies but €30,000 is good working approximation) then they have to register at destination, charge VAT rates of destination, and remit to destination (although in some cases the origin country will accept the payment on behalf of destination as a convenience)

There has been a common UK ecommerce retail workaround (which is being challenged by some jurisdictions) to retain rating/collecting at source: Customer is sold the item "ex warehouse gate" via a special purpose company (justifying rating/collecting at source), and is "introduced" to a carrier who will move the goods to the destination on behalf of the customer via a separate contract (and carriage is always rated/collected at source). This has been attractive for the customer (UK rates historically have been a bit lower than other countries in the EU) and also for the retailer (simpler paperwork and compliance.)

The criticism is that the UK government has received VAT revenues that more properly belong to other EU countries --193.35.250.233 (talk) 15:42, 15 July 2015 (UTC)

Suggestion on a section
The following sentence in the early section of the article is very ambiguous :

"VAT proposes to replace sales tax which in most developing countries trying to shift to some variant of VAT, like India, is the 'only' major revenue source for the regional governments since low per capita income and unemployment render income tax inadequate as a revenue source."

What is the only major revenue source? Is it VAT or is it Sales Tax? The answer is obvious to an alert and informed reader. But we could make it a little more novice friendly. My suggestion is following:

"VAT proposes to replace sales tax. Presently, sales Tax is the 'only' major revenue source for the regional governments since low per capita income and unemployment render income tax inadequate as a revenue source in most developing countries like India, which are trying to shift to some variant of VAT." —Preceding unsigned comment added by Pranesh Bhargava (talk • contribs)  18:36, 15 January 2008 VAT (Value added Tax) — Preceding unsigned comment added by 182.74.43.194 (talk) 10:05, 10 December 2013 (UTC)

IF "low per capita income and unemployment render income tax inadequate as a revenue source in most developing countries like India, which are trying to shift to some variant of VAT" is true then is the VAT a way to shift revenue collection more toward the businesses? If the people are to poor for sales taxes, I fail to see how they will be able to pay a VAT any better. The above sentence seems to be saying that the poor are tapped out - they can't support the government without some help from those who still have some spare money. 2601:181:8000:D6D0:8B2:44E3:809:75B1 (talk) 11:58, 27 October 2015 (UTC)

External links modified
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 * Added archive https://web.archive.org/20141205140805/http://crcmich.org/TaxOutline/TaxOutline.pdf to http://www.crcmich.org/TaxOutline/TaxOutline.pdf

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Brazilian VAT
ISS is not a VAT and doesn't apply to the same products. By law if a product is taxable by ICMS, it cannot be taxed through ISS. — Preceding unsigned comment added by 189.125.130.2 (talk) 12:12, 29 March 2016 (UTC)

Assessment comment
Substituted at 18:43, 17 July 2016 (UTC)

Dr. Bird's comment on this article
Dr. Bird has reviewed this Wikipedia page, and provided us with the following comments to improve its quality:

"this entry has so many problems that i simply do not have time to go through them all this week."

We hope Wikipedians on this talk page can take advantage of these comments and improve the quality of the article accordingly.

We believe Dr. Bird has expertise on the topic of this article, since he has published relevant scholarly research:


 * Reference : Richard M. Bird & Michael Smart, 2008. "The Impact on Investment of Replacing a Retail Sales Tax by a Value-Added Tax: Evidence from Canadian Experience," Working Papers Series 15, Rotman Institute for International Business, Joseph L. Rotman School of Management, University of Toronto, revised Jun 2008.

ExpertIdeasBot (talk) 13:44, 6 August 2016 (UTC)

TAFTA
Does TAFTA change, remove, or reduce exports from the United States to EU? Twillisjr (talk) 22:07, 22 September 2016 (UTC)
 * Hello. The talk page is for discussion of the content of the article, it is not a discussion forum. See Talk page guidelines. In general, the main focus of free trade agreements is to reduce trade barriers, which increases exports from all parties to it. AHeneen (talk) 01:42, 23 September 2016 (UTC)

Reads like an advertisement for VATS.
"The VAT is an alternative to a sales tax and is meant to deal with a specific problem. With a sales tax, a business selling goods is responsible for making a subjective decision about the intent of a buyer, the business may not be fully competent to make the decision.

If buyers intend to consume the goods themselves, then the seller must collect a tax on the purchase price. If instead buyers intend the goods as capital goods, to be resold at a profit after adding value to them, then the seller must not collect the tax. Additionally, sellers have an incentive to claim that a sale is not taxable in order to please customers; this slight conflict of interest could, and probably would, result in an under-collection of taxes."

For the United States, it is not an alternative to a sales tax.

Businesses do not make "subjective" decisions about the intents of buyers. Apparently whoever wrote and contributed to the cited text have never owned a business; nor have run one. Businesses MUST follow specific guidance and tax law to objectively assess the intent of a buyer. All buyers who intend the purchased good(s) as capital goods, or to be resold at a profit MUST by law provide the seller with a Tax ID number if the buyer expects to be excluded from paying sales tax for the transaction.

--

"A VAT is like a sales tax, but in that, ultimately only the end consumer is taxed."

False. Mark-up is indeed taxed / paid at each stage of the supply chain.

-- RJKMatthews (talk) 22:40, 30 August 2016 (UTC)


 * Like many Wikipedia articles, this article is not as good as it could/should be. I have removed the excessive comparison with sales tax from the lead. "For the United States, it is not an alternative to a sales tax." That is a political view. Wikipedia articles on general topics like this require a worldwide point of view and VATs are indeed an alternative to sales tax, even in the US. Of course, it is reviled by most politicians and many Americans, but it is nonetheless a feasible alternative at the federal level(many politicians pushing for a business flat tax, which is a subtraction-method VAT) and subtraction-method VATs have been historically implemented by Michigan. "False. Mark-up is indeed taxed / paid at each stage of the supply chain." While the wording is not great, the statement was true. Businesses collect and remit tax at each stage of the production/retail chain, but it is only the final consumer who directly bears the tax. The taxable event is the sale or supply of goods/services. Businesses directly charge the tax on the final sale to the end consumer and receive a credit for VAT paid on all their inputs. This is in contrast to income taxes and gross receipts taxes, which are directly imposed on businesses that then indirectly incorporate those taxes into prices charged by consumers. AHeneen (talk) 20:57, 24 September 2016 (UTC)

Old page history
Some old page history that used to be at the title "Value-added tax" is now at Talk:Value-added tax/Old history. Graham 87 06:51, 3 November 2016 (UTC)

Example of Ford v Opel Wrong
The US, contrary to what this page asserts, does NOT have a sales tax. Individual states do, and they are all different, and nowhere is it 10%. — Preceding unsigned comment added by 213.152.161.229 (talk) 18:44, 3 April 2017 (UTC)

Opening paragraph
Hello,

I tried to improve the first paragraph because I could not understand it. My first edits contained misunderstandings and I proceeded to correct them in the Overview section.

Somebody reverted my changes. Sorry for the flawed edits, I tried my best, but I still think the first sentence of the article should be simplified. — Preceding unsigned comment added by 83.145.206.39 (talk) 22:22, 29 April 2017 (UTC)