Small Business Encyclopedia:
A value-added tax (VAT) is a fee that is assessed against businesses by a government at various points in the production of goods or services—usually any time a product is resold or value is added to it. For tax purposes, value is added whenever the value of a product increases as a result of the application of a company's factors of production, such as labor and equipment. VAT must be paid by every company that handles a product during its transition from raw materials to finished goods. For example, tax is charged when a manufacturer sells to a wholesaler and again when a wholesaler sells to a retailer.
With VAT, the taxable amount is based on the value added at each stage of the process of producing goods and bringing them to market. As an example, say that a company that makes socks buys cotton yarn for $1,000; adds $500 to its value in terms of labor, depreciation of knitting machines, and profits; then sells the completed socks for $1,500. VAT would be calculated as a percentage of the $500 value added by turning cotton yarn into socks. Of course, the sock company would also get credit for the amount of VAT it paid on the purchase of inputs, like cotton yarn.
In general, the total VAT accrued during the production of goods is reflected in the price of items sold to final consumers, because each reseller along the way usually passes along its VAT costs. In this way, VAT is somewhat similar to a national sales tax, and the two forms of taxation are often compared by governments. Experts claim that VAT entails higher administrative costs but is easier to enforce than a national sales tax.
Oh Lord, help us.
It's part of Obama's brilliant plan to tax the people. Obama is no record now stating he thinks an VAT tax makes sense.
More lies out of Treasury Secretary Geithner saying the Bailout will only cost $87 Billion.
If that is so then why did the Deficit rise $1.3 Trillion?
GM is running TV ads implying they have paid back all their loans. What a load of crap! GM is still $45+ Billion in debt. They lost over $3 Billion in the last quarter of 2009. Their finance arm GMAC was spoon fed $18+ Billion. Just more lies from the Government. And what kind of idiot is going to buy GM stock when they have no assets to back up the IPO and they are sitting on $45 Billion in debt?
Now they are pretending to regulate Wallstreet? What a joke. It's nothing more than a shift of power from the people to the Federal Reserve... which for the uninformed isn't even a Government Agency.
How can you have financial reform when you let the very people who CAUSED the problem have the regulatory authority?
Next on the Agenda CAP and TAX in the name of climate change.
Team Obama is destroying the United States of America. And the Republicans are just playing into the plan.
This country is bought and sold and run by Bankers... private bankers... the people who control the money supply... the people who print money from nothing and control inflation and deflation.
And stupid Americans sit around and argue politics why they laugh and take control of every last thing you own.
Until the Federal Reserve is abolished you can watch the American Dream collapse.
Mike, we don't have 13 Trillion in petty cash to buy all the gold bricks in the universe to store in Fort Knox so you can sleep well at night. The Gold Standard is dead. Get over it.
Well, since the gold standard is dead, then what on earth is providing value to currency?
An astute question and economists who write textbooks can devote a chapter to that single question. The answer is different at an individual, national and internatinal level and there are aspects for an international banker different than for a foreign head of state. Not wanting to put anyone to sleep, I will say that ultimately the 'value' of any currency is based on the perception of the productivity of the workers in that country and the faith of the people who use that currency.
Good reply Doug. Money relies on faith and perception - and to maintain that illusion it also relies on somebody NEEDING each dollar, and also WANTING each dollar. The money cycle itself is responsible for poverty and makes it impossible to win overall; for every one dollar you climb, somebody else must descend one dollar - and this is why the idea of money itself is overdue a change.
You get into the 'money cycle' which is a critical aspect of economics. The end of the cyce is when that dollar is stashed in savings - at least in Keynesian economics. That's why tax cuts for the wealthy don't stimulate the economy much in a recession. The rich guy who gets a tax break stashes the savings. Give that money to someone unemployed, he spends it - he has to buy groceries and that employs people who produce food and disposable goods.The receier of that dollar spends it... The same dollar cycles several times before it's absorbed in savings. This is a multiplier in economic terms. One dollar injected in the right place in the economic cyle has more value than the same dollar wasted somewhere else.
People who are intelligent enough to understand what the Federal Reserve is... realize the "Gold Standard" and Fractional Reserve Banking are TWO entirely different things.
But the proof of ignorance is in the response.
TRUE Americans don't "Get over" the FACT that the Federal Reserve System is one run by private bankers and makes Debt Slaves out of citizens.
But then again there are people who really don't want to save America, people that don't believe in being rewarded for working hard, people who just want to get in a line and expect the Government to give them something they are "entitled to".
Those are the people that are going to get exactly what they deserve if this movement to shift America's Assets offshore to private bankers isn't stopped.
The Federal Reserve System is the national bank. It's been in operation for 96 years, not without a few bumps in the road. But it's hardly an experimental concept.
So you don't want the National Bank (the Fed) run by bankers - instead you would nominate??? homeless people perhaps?
What 'assets' are being shipped offshore by the Fed? And does an answer to that question belong in 'conspiracy theories'?
I know you love that phrase 'debt slaves'.. Real catchy. The level of debt as a percent of GDP is under 70%. It's been over 100% - after WWII, and getting the debt down required higher taxes on the rich - DURING TWO OF THE MOST PROSPEROUS DECADES OF OUR HISTORY.(mid 40s to mid 60s)
The claim that the sky is falling because of the national debt is a scare tactic. I have noticed that you oppose every effort to manage the debt by rasing taxes. If the middle class in this country is going to enjoy the standard of living and security that the workers of other nations enjoy, the top tier is going to have to start paying their fair share of taxes.
You really need to look at actual debt rather than debt-as-a-percentage-of-GDP.
GDP is a nonsense concept. It includes government spending. So GDP can go up simply because government spending has gone up, thus making the economy look healthy even when it's not.
Here are the actual national debt figures year on year for the US, since 1940 (scroll down to the red graph, or even further to the blue graph for figures that are corrected for inflation).
Actually, I'd be interested to know if you've got a source for this.
PS: I live in a country that has VAT (17.5%) and it has to be the stupidest tax going. A company that is VAT-registered (you have to be earning a certain amount per year to qualify) can claim VAT back on its purchases, although it still has to pay VAT on its earnings. This entails - guess what - lots of form-filling for the company concerned, and a penalty for late or non-payment.
But people on PAYE or sole traders/companies who earn less than the VAT threshold still have to pay VAT on everything that attracts it. So it's really a tax on the poor, plus a way to give jobs to bureaucrats.
Also there are some really stupid anomalies - in Britain, biscuits (cookies) are VAT-able, whereas cakes aren't. Hence this very long-winded and expensive court case:
"So you don't want the National Bank (the Fed) run by bankers - instead you would nominate??? homeless people perhaps?"
Straight out of the mouth of the Devil:
The Fed answers to no one!!!
"In addition, to address continued pressures in global U.S. dollar funding markets, the temporary reciprocal currency arrangements (swap lines) between the Federal Reserve and other central banks have been extended to October 30. This extension currently applies to the swap lines between the Federal Reserve and each of the following central banks: the Reserve Bank of Australia, the Banco Central do Brasil, the Bank of Canada, Danmarks Nationalbank, the Bank of England, the European Central Bank, the Bank of Korea, the Banco de Mexico, the Reserve Bank of New Zealand, the Norges Bank, the Monetary Authority of Singapore, the Sveriges Riksbank, and the Swiss National Bank. The Bank of Japan will consider the extension at its next Monetary Policy Meeting. The Federal Reserve action to extend the swap lines was taken by the Federal Open Market Committee." -- source http://www.federalreserve.gov/newsevent … 90203a.htm
Over and over... you prove my point... just spewing off at the mouth with ZERO substance. Nothing to back anything up in the real world.
And no I'm not stupid enough to let Foreign Interests control American Assets are you? Are you? You want Foreign interests controlling America's future? Private secret bankers manipulating the currency? That's what got America into the situation it's in.
You have no idea about the Trillions of Dollars the Federal Reserve is dishing out to Foreign countries with ZERO Accountability... all being ignored by the Media.
Instead of proving over and over how uneducated you are about the Federal Reserve... why not take some time to actually learn something?
In a world full of idiots without the capacity to actually educate themselves... you are at the top.
And I will happily take a ban for pointing out your complete and total ignorance.
Perhaps you should get a job and get off the public payroll. I have better things to do with my time than argue with idiots whose only acceptance comes from propagating forums with ignorance. You are exactly what is wrong with the liberal left. Completely uneducated as to what is really going on in the world.
I don't agree with most of what Deeds spews out of his mouth... but at least he attempts to back himself up... attempts.
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