Value Added Taxes are important to understand since it has been discussed for Americans and a common global tax practice in recent economic history. With sales taxes goods are taxed only at the point of sale to the consumer. VAT is the practice of taxation along the whole chain of manufacturing a product. Ultimately it adds much more to the final price to the consumer. However it may be very lucrative for governments, the burdens will eventually be pushed down the line to the consumer. This creates massive increases in prices for goods. Most of the world already understand the tremendous impact VAT has on cost of living, Americans need to be prepared for this being implemented in our future as well.
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Ukip leader Nigel Farage |
The European Commission wants VAT exemptions on food, children’s clothes and other essentials abandoned in an effort to harmonise the sales tax across Europe.
Its plans come after the Coalition raised the VAT rate to 20 per cent last year but kept an exemption for food, children’s clothes, passenger travel, books, newspapers and other products.
Last night the proposals sparked outrage among politicians and public-spending campaigners who attacked the Eurocrats for trying to interfere in Britain’s tax affairs. Ukip leader Nigel Farage said: “In their desperation to raise cash, the EU is prepared to do anything and hurt the most vulnerable.
“These plans would add up to 20 per cent costs on food and children’s clothes. To put an extra tax on books and newspapers would be a strike for ignorance over education.
“Everyone would suffer, but the most vulnerable would suffer the most.”
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