Math for Non-Math Majors
A value-added tax (VAT) is a consumption tax placed on a product whenever value is added at each stage of production or distribution. This type of tax is collected incrementally, based on the increase in value of a product at each stage of production and distribution, making it distinct from traditional sales tax which is typically assessed only at the point of sale to the final consumer. VAT can affect pricing, discounts, and overall consumer costs, impacting both businesses and shoppers alike.
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