List of Countries Without a Value-Added Tax
Sovereign states without VAT
Brunei Darussalam
Iraq
Kuwait
Qatar
Syria
United States
Sovereign states without VAT
Brunei Darussalam
Iraq
Kuwait
Qatar
Syria
United States
Having lived in and used both systems, VAT seems to be a lot fairer. Instead of nailing the end consumer with all the tax, the tax is distributed over the entire production chain. This also reduces the ability to game the system.
I've lived under GST and I've lived under VAT. As a consumer, VAT is a million times better.
Firstly, GST was added at the till. So something is marked as $5 on the shelf, ends up costing more than $5 at the till. Bonkers.
VAT is included in the delivery price. Says $5.99 on the shelf? You get a penny back from $6.
From a shop owner point of view, VAT is also a lot easier to administer. You don't care if the customer is VAT registered or not. That's their problem, not yours. GST was a headache. Some stuff goes yo end users (so collect tax) others goes to resellers (so dont). Here's a shocking outcome - rampant tax fraud... (fraud with VAT is still possible, but the tax loss is only on the vendors markup.)
Obviously different jurisdictions do VAT and GST differently, but when I travel to the US it feels like the stone age.
GST and VAT are the same thing, different countries just call them different things.
As an example, GST in Australia is in the price on the shelf. You can also claim back the GST you paid on your input goods, which means you effectively pay the difference on the GST your customers pay you, and you paid your suppliers (which is the value added!).
It's one of those core innovations like double-entry bookkeeping making things more fair.
VAT provides an incentive for businesses to register and keep invoices, because they automatically pay more for tax they can't show invoice.
I just found out that many people in the US have opinions against it when Trump/Vance did bring out VAT into the discussion, so I felt I had to confirm my assumption that VAT is nearly universal. In some ways the US attitude is like UK was in the 1900s when it comes to infrastructure of governance "old things work just fine."
> It's one of those core innovations like double-entry bookkeeping making things more fair.
How is Double-entry bookkeeping making things more fair or not? it's just a better technical solution to a problem accountants faced
It's a regressive tax: https://taxpolicycenter.org/briefing-book/who-would-bear-bur...
>Although a value-added tax (VAT) taxes goods and services at every stage of production and sale, the net economic burden is like that of a retail sales tax
1. all goods and services taxation is regressive.
2. VAT is better than alternative goods and services taxation methods.
Argument for removing goods and services taxation is one thing.
Argument for compensating good and services taxation to the poorest (as is common) is another.
None of these are arguments against VAT itself. VAT is harder to avoid and brings more money and allows lower tax rate all things considered.
In the source you provided look up the:
>Why is the VAT administratively superior to a retail sales tax?
What if you waive it on food, school supplies, public transport &c...
It reduces the degree of regressive, but as long as lower-income people spend any money at all on nonexempt goods it will never make it neutral.
It's typical to have reduced VAT for food, etc.
There is even better way to offset the regression of consumption taxes. Hint three letters, starts with U.
UB40
How does British Reggae help us?
I think consumption taxes are inherently some of the most moral taxes since they give individuals some consent in their taxation – assuming essentials are not subject to VAT.