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Author Topic: 2010-11-11  (Read 1283 times)

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« on: November 13, 2010, 10:59:38 AM »

VAT is paid by every trader in the supply chain. For example, 22% tax on the supply chain might look like this:
Factory of raw material:
Manufacturer of raw material valued it at 100 $ (net price) and sells plant for $ 122 (100 $ + 22% = gross price). Then pays 22 $ VAT.
Factory of the product:
The factory manufactures the product, valued it at 150 $ (net price) and sells the shop for 183 $ (150 $ + 22% gross price). VAT is 33 $, however, the factory deducts the VAT paid by the producer is 22 $ and finally pay "only" 11 $. This represents a 22% VAT (50 $) or "value added" by the factory in relation to the price of raw material.
Store valued the product at 250 $ (net price). A final gross price for the consumer is 305 $ (250 + 22%). VAT is 55 $, of which, however, store counts 33 $ paid factory, paying 22 $.

In total, the govt get 55 $ (22 $ + 11 $ + 22 $) which is the same as the number of 22% of the net 250$.

Currently we have in poland 22% VAT but in next year we will have 25% (they cant rise more, that because of EU law but i think that there is no such law). Imagine how much calculation U need to do if your company buy services and lot of different materials and make lot of different products. Even in small business you need someone to just calculate this taxes. That is not all, if u dont pay them enough (u made mistake and they didnt get enough your money) then you are TAX THIEF, cheater and you "deserve" to be punished and they make you pay: penalty + unpaid tax + interest. If they make mistake they just give back your money. Poland is almost tax hell politics dont understand the concept of Laffer curve, but why should they this isn't about tax it about budget... they have deficit, debt they need to have more money, in every election every one promise lowering the tax but guess what they do opposite.  I try to explain ppl that every tax is stilling and more they pay the more they own them but ppl usually say that "Do you have food? Do you have place to live? Do you have job? so what do you need more?" It is so hopeless...

I hope you will understood me (I'm learning English) fun from poland :|
« Last Edit: November 13, 2010, 11:09:37 AM by s3b3k »
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