VAT. These three letters are definitely familiar to all of us, even those who have nothing to do with business. The abbreviation appears on the receipt received after purchases. But, what it is and why it is everywhere, wherever you look, is known far less to everybody. And even if we ask these questions, the very decoding of “value added tax” in general may not say anything, except that it is another tax. But it is just necessary to know about it, because VAT applies to any person, be it a sales manager or a factory worker.
What is the first thing to know? That VAT – is a tax on which the seller increases the price of his products, which means, that having received the proceeds, selling company is obliged to pay tax from it to the budget, therefore, it is laid in the proceeds. Actually, it is the buyer paying the tax, and from seller's revenue it goes to the budget.