Thank you for clearing that up - I was under the mistaken impression that most goods were subject to sales tax in the US, even in b2b transactions. I was not aware that most entities other than individual people were tax exempt. That makes the end result a lot more similar to VAT than I thought it was (though with a different way of getting there).

Given all that, why would we use a VAT system rather than sales tax? So that the revenue is more evenly spread across the lifetime of a good or service?