> Europe’s VATs are not tariffs and are not subsidizing European exports. Instead, US states’ poorly-designed sales taxes are harming their own businesses’ competitiveness—whether they’re selling down the street, across state lines, or around the world.
The two things seem unrelated?
The consumer pays the VAT, not the producer.
Naturally the chain breaks at the border, so importers pay vat and exporters get vat refunds.
In the end its just a sales tax
European customers handle the VAT themselves when dealing with non-VAT-registered non-European suppliers; this is known as the "reverse charge" mechanism and it's generally a feature of almost every VAT system in the world. (In a nutshell, the customer charges themselves VAT and pays it on their own VAT return. This is similar to the way "use tax" works in the U.S.)
Similarly, if the EU applies VAT to all goods sold, that can't be considered discriminatory just because some other country doesn't apply VAT.
but only because of tariffs, not VAT system. we pay VAT regardless from where the good came from.
But regardless, US exporters to the EU end up paying more taxes than domestic EU producers.
No, because the domestic EU producers are paying VAT at each stage of their production process. The US manufacturers need to catch up!
As long as I know, VAT should be payed only once for a finished product when sold to the very end customer.
Which is why being a registered one man company with a vat number allows you to get back vat for your laptop
Have Americans become really that dumb?
It’s not a question of being dumb or not, but rather that VAT doesn’t exist in the US so most people don’t understand how it works, if they have even heard of it at all.
Instead of VAT, most states have sales tax, which is similar in spirit but doesn’t work the same way.
Being confidently wrong in the comment section is dumb and arrogant.
But apparently facts don't mean anything anymore in that crazy country there.
The mistake I think Vance made was assuming that Europe doesn’t tax its own vehicles 30%. If he wants to “reciprocate” by impose higher taxes on BMWs, Mercedes, and Audis so I don’t have to deal with their drivers egos every time i go on the highway, let him. This is not a product class that is adding much value to our society in my opinion. I would hope they aren’t so difficult on Honda/Toyota since both brands provide good reliable cars while US manufacturers try to get their shit together