This is wrong.

If i offer a service for 100 €. I have play VAT for i, typically i add these to the bill, but for the sake of simple numbers i dont.

As an example, i have following costs for offering the service: - Materials: 20€ - i can deduct these from the VAT. - Salaries: 60€ - i can NOT deduct these from the VAT. - Profit: 20€ - i can NOT deduct these from the VAT.

So earning my company 100€ will have me pay (in switzerland for example 7%) approximately 6€ VAT, the 1€ i did not have to pay, must be paid by the producer of the materials. Of course you can argue that the customer pays the 6€ and my company only pays the 1€, but it's never the less always a split bill.