In message , Adrian
writes
On Wed, 18 Feb 2015 21:25:14 +0000, bert wrote:

But about the difference between a sales tax and a value-added tax?

AIUI vat involves a transaction at every stage of the process that fails
to generate any revenue until finally what ever it is that's being sold
goes to someone or some organisation that is not Vat registered. So the
net revenue gained by HMRC per recorded vat transaction can be very low.

HMRC don't record VAT transactions.
I didn't say they did.
HMRC get a quarterly return from
every VAT-reg business. All those businesses have to record all the
transactions anyway, in order to have any kind of meaningful accounts.

As I said computerisation takes a lot of the effort out of it - until
something goes wrong.
It is very inefficient especially for any small business operating
manual accounts as they are constantly recording VAT transactions which
cancel each other out.

You've never been involved in any kind of book-keeping for a business,
have you?

Yes both manually and computerised and also have had the pleasure of
trying to explain to someone the difference of 1p that arose because of
the different rounding rules for manual and computerised vat systems.
B'sides, ever heard of the flat-rate VAT scheme for smaller businesses?

Yes, one of those typical civil service ideas to "simplify" things which
can actually make matters worse. I never used it.
A sales tax is applied once only at the final point of sale.

So let's say I walk into a store to buy £100 worth of stuff. How does the
bloke on the till know if I'm buying it for a business, an untaxed sale,
or for personal use, taxed? Or, if both would be taxable, then doesn't
that increase the cost to the business, which is only going to get passed
on to the eventual end consumer?
I didn't say it was better. I was attempting to explain the difference
in response to a question.
--
bert