Why does VAT occur?

Value added tax is a tax incurred when consumers purchase goods or services.

VAT is used in various countries.

The name and structure of taxes may vary in each country.

Generally, it is a tax levied on consumers.

VAT is incurred for the following reasons:

To control consumption: VAT is used as an economic control over consumption.

People are discouraged from excessive spending because they have to pay more taxes when purchasing expensive goods or services.

This helps stabilize prices and maintain balance in the economy. 부가세계산기

Government Revenue: VAT is one of the important sources of revenue for the government.

Collecting VAT is one of the ways governments get the money they need to provide public services and maintain infrastructure.

Maintaining a fair tax system: VAT is not levied pro rata when consumers purchase goods and services.

It helps avoid discrimination based on income and maintains a fair tax system.

In summary, VAT regulates consumption and secures revenue for the government. And it is a tax used to maintain a fair tax system.

Each country’s VAT laws and regulations may vary.

For detailed information on specific VAT policies, we recommend checking with your country’s tax authority or government website.

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