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sales tax and value added tax

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sales tax and value added tax

Sales tax and value-added tax (VAT) are two common forms of consumption tax but differ in their structure and application. Sales tax is applied at the point of sale to the end consumer, with the retailer collecting the tax and remitting it to the government. In contrast, VAT is applied at every stage of the production and distribution chain, with businesses claiming back VAT paid on their purchases, ensuring that only the final consumer bears the full tax burden. While sales tax is primarily used in the U.S., VAT is widely implemented across Europe and other regions worldwide. Understanding the differences between these two taxes is essential for businesses involved in international trade or operating in countries with varying tax systems.
By: 360 Accounting Pro
28-Jan-2025 01:14 pm
Business & Services
User Website : https://www.360accountingpro.com/blog/what-is-the-difference-between-sales-tax-and-vat

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