Reply to post: You don't have to pay VAT for business expenses?

Amazon and eBay agree to expose potential VAT evaders for UK tax man

Anonymous Coward
Anonymous Coward

You don't have to pay VAT for business expenses?

Definitely different than state sales taxes in the US then. A business is only exempt from sales tax for something that is resold as is (i.e. if you buy computers wholesale and sell them, you don't pay sales tax for the purchase, but collect it from the sale) or something that is processed into something that you sell (like a restaurant buying beef that is ground to make burgers)

If I buy a new printer for my home office to use in my business, there's no exemption. I have to pay sales tax on it. Doesn't matter whether it is a one person company doing $5000 in sales a year or Apple doing a couple hundred billion in sales, both have to pay sales tax when they buy that printer.

Doesn't make sense to me that businesses are exempt from paying VAT. If a restaurant buys a printer, they obviously aren't selling printers or using it when they make a burger, so why not collect VAT on it? If they collected VAT on all that stuff they could probably lower the overall VAT rate significantly while collecting the same revenue, and make it harder for cheaters to dodge VAT by saying something will be used by their business when it isn't.

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