I find this amusing: I'm from Poland, where after the VAT tax was introduced in the 1990s, there were famous "VAT carousel" crimes, with people ending up in prison. The basic idea was similar, except you also collected VAT refunds from the state.

If you search for "vat carousel" today, it seems this is still a thing.

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gaiagraphia 5 hours ago | parent | next [-]

VAT is a joke of a tax. It's quite incredible why the government concerns itself with chasing people's accounts around. What a waste.

If something can't be monitored with minimal effort, it only serves to enrich the legal/accountancy/hr/admin priest caste.

The amount of labour wasted on moving numbers around numbers is staggering.

edit: Between the government and businesses, VAT costs 5% in admin fees to raise. In a modern world where most transactions are digital, is this a great use of resources?

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ww520 4 hours ago | parent | next [-]

VAT is a regressive tax. It hits everyone along the way, rich or poor. It hits the poor especially hard proportionally.

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derriz 3 hours ago | parent | prev | next [-]

VAT is trivial for businesses to deal with. You add x% onto every invoice you issue. The VAT due to be paid to the government is a simple sum of the amounts distinctly shown on each invoice you issue minus the sum of the VAT amounts on invoices you’ve paid. Income/employment taxes, corporate tax, import taxes, etc are orders of magnitudes more complex, dynamic and subject to legal interpretation. I was a small business owner for a while years ago and did the VAT myself. But there was no way I would even attempt employment or corporation taxes - covered by endless legislation and changing every year - that was a job for the accountant.

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stephen_cagle 3 hours ago | parent | prev | next [-]

I've multiple times done a minor dive into why a VAT tax is seen as a reasonable tax? It... seems as regressive as a sales tax with even more layers of intervention? I've always eventually lost interest in trying to make sense of it, but they sure seem popular in Europe so there must be something to them?

My current belief is that there should really just be a wealth tax on assets (Federal) and a land value tax on land (States); nothing else.

	▲	shimman 2 hours ago \| parent [-]
		Good thing we don't cater society to your beliefs, else it would lead to collapse of the welfare state and cause the needless deaths of tens of millions of Americans.

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whynotmaybe 3 hours ago | parent | prev [-]

Source for the "5%"?

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debarshri 5 hours ago | parent | prev | next [-]

VAT carousel is fraud. This is pre-legal.

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econ 4 hours ago | parent | prev [-]

I first hear about this from a guy running a warehouse. He noticed the same boxes commining in again and again.