Re: What about the VAT?
Not sure I follow your argument captain.
Consider the following:-
Manufacturer 1 makes a widget which he sells to manufacturer 2 for £1.00
His invoice price with VAT is £1.20
Net VAT to taxman = £0.20
Manufacturer 2 claims back his VAT portion.
Therefore net VAT to taxman + £0.00
Manufacturer 2 incorporates said widget and sells finished item to Distributor for £2.00
His invoice price with VAT is £2.40
Net VAT to taxman = £0.40
Distributor claims back his VAT portion.
Therefore net VAT to taxman + £0.00
Distributor sells on to wholesaler for £3.00
His invoice price with VAT is £3.60
Net VAT to taxman = £0.60
Wolesaler claims back his VAT portion.
Therefore net VAT to taxman = £0.00
Wholesaler sells on to retail for £4.00
His invoice price with VAT is £4.80
Net VAT to taxman = £0.80
Retailer claims back his VAT portion.
Therefore net VAT to taxman = £0.00
Retailer sells on to End User for £5.00
His invoice price with VAT is £6.00
Net VAT to taxman = £1.00
End User cannot reclaim his VAT
Therefore Net VAT to taxman = £1.00
I know that's fairly simplified but basically that is how it works. There are profits all the way, but the end user ends up paying all the VAT. If you substitute Apple in the various stages it makles no difference. 20% of the final selling price goes to the taxman.
The retailer claims his outgoing VAT on whatever it is that he's buying in, be it services or goods , but he still has to pay that final 20% on the ultimate invoice.