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What Is a Value-Added Tax?

By Motley Fool StaffUpdated Nov 18, 2024 at 1:27 PM

Key Points

  • VAT is a consumption tax paid at each production stage, reimbursed from prior stages.
  • Final VAT costs are borne by the consumer, raising the final product price.
  • Critics label VAT regressive, burdening lower-income more than wealthy individuals.

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