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EU VAT Tax Rates. The European Union value-added tax (or EU VAT) is a value added tax on goods and services within the European Union (EU). The EU's institutions do not collect the tax, but EU member states are each required to adopt in national legislation a value added tax that complies with the EU VAT code.
This is a tax relief that applies to low-valued imports to the European Union, exempting them from value-added tax (VAT). Although the UK was a part of the EU from 1973 until Brexit in 2020, the Channel Islands (two Crown Dependencies ) were not and, unlike the UK, they did not charge VAT on purchases.
Map of the world showing national-level sales tax / VAT rates as of October 2019. A comparison of tax rates by countries is difficult and somewhat subjective, as tax laws in most countries are extremely complex and the tax burden falls differently on different groups in each country and sub-national unit.
A value-added tax (VAT or goods and services tax (GST), general consumption tax (GCT)) is a consumption tax that is levied on the value added at each stage of a product's production and distribution. VAT is similar to, and is often compared with, a sales tax.
For a VAT and sales tax of identical rates, the total tax paid is the same, but it is paid at differing points in the process. VAT is usually administrated by requiring the company to complete a VAT return, giving details of VAT it has been charged (referred to as input tax) and VAT it has charged to others (referred to as output tax).
The Office for National Statistics report showed that in 2009/10 the poorest 20% spent 8.7% of their gross income on VAT, whereas the richest 20% spent only 4.0% of their gross income on VAT. [57] Similarly, the poorest 20% spent 9.7% of their disposable income on VAT, whereas the richest 20% spent only 5.2% of their disposable income on VAT ...
CBO estimated that a 5 percentage point VAT would collect between $1.9 trillion and $2.9 trillion over the 2019-2028 period, depending on the base of activity to which the tax was applied. Such a tax would be regressive, as it would impact lower income persons relatively more.
[citation needed] Until 2001, VAT was charged at the full rate on sanitary towels. [58] VAT was introduced in 1973, in consequence of Britain's entry to the European Economic Community, at a standard rate of 10 per cent. In July 1974, the standard rate became 8 per cent and from October that year petrol was taxed at a new higher rate of 25 per ...