In SX Microcontrollers, SX/B Compiler and SX-Key Tool, g_daubach wrote:

I like VAT from my company's point of view. If I buy something from a distrubuter for say EUR 100.00 I have to pay an additional 16% VAT, i.e. EUR 16.00 but I can deduct this amount from my taxes payable. Later, when I sell that stuff, say for EUR 200.00, I charge my customer an additional 16% = EUR 32.00. In the end, with the tax deduction I have to pay a total of EUR 16.00 taxes, i.e. I pay the 16% for the Value I have Added (this is what VAT stands for).

When I have a loss, say I bought something for EUR 200.00 but can only sell it for EUR 100.00 its the same calculation, i.e. I can deduct EUR 32.00 from my taxes and have to pay EUR 16.00, i.e. in the end I get a refund of EUR 16.00.

Before VAT, companies had to pay 4 or 5% on all revenues they made, i.e. even when I making a loss, they had to pay the 4 or 5%.

As you can see, VAT is not simply be a replacement for income taxes (which we have to pay in addition to the VAT). The poor guys are the end-users - they pay the full amount of 16% VAT (or 7% on food, books, and some other stuff) as they can't deduct it from anything.

Amazing as is, the new German government has announed to raise VAT to 17% or even more in 2007. This announcement seems to really have an impact on the domestic economy because people already have started buying things now, and consumption will definitely increase even more in 2006 before the VAT is raised in 2007. Maybe, the government will tell us in 2007: "Sorry, we were only kidding, VAT will not be changed" but to be honest, I don't believe that :-) .

---------- End of Message ----------


You can view the post on-line at:
http://forums.parallax.com/forums/default.aspx?f=7&p=1&m=100921#m101510

Need assistance? Send an email to the Forum Administrator at forumadmin@parallax.com

The Parallax Forums are powered by dotNetBB Forums, copyright 2002-2005 (http://www.dotNetBB.com)