Value Added Tax (VAT) Explained
In the discussions on Huckabee’s support of the Fair Tax, the idea of a value added tax (VAT), a type of consumption tax, was raised. Having little experience with it myself, I thought it would be valuable to turn to someone who actually did – Plonkee. As a resident of the UK, Plonkee has more first hand knowledge of the VAT so I asked her to describe it for us. This is not to say that the UK’s version of a VAT is how every VAT is, but seeing as how our cultures are basically siblings, it’s not a bad thing to understand.p
What is VAT?
In the UK, as in almost all of rest of the European Union, we have both an income tax, and a consumption tax – in the form of VAT. Like most taxes over in the UK, they are levied by central government and are used to fund both central and local government functions and services.
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